To do what?Will the Central Bank now intervene?
To require banks to justify their exceptionally low deposit rates.To do what?
So vague as to be meaningless. To turn it on its head ten years ago the story was that unprofitable banks wouldn’t lend to viable personal borrowers. Today’s profitable banks aren’t rationing credit which surely benefits consumers, albeit borrowers not savers.In other words, to enforce the Consumer Protection Code requirement that a bank acts "in the best interests of its consumers and the integrity of the market".
Different jurisdiction, different regulatory framework.The FCA has already called UK banks to task for being slow in passing on BOE rate increases to customers.
The average new business mortgage rate was 25bps higher than the EU average in June. 25bps is material in this context.I don't think that they are materially above.
It's really not that easy - look at all the complaints on here about Raisin customer service. We had reports of posters that tried to open accounts and eventually gave up in frustrationBut I have little sympathy for someone getting 0% on €100k in an AIB demand deposit account when it's so easy to get more in an account in another eurozone country.
But the point is that our banks can no longer justify offering lower than average deposit rates on the basis that they offer lower than average mortgage rates.
What you’re describing is a building society business model from 1977. It no longer exists.But the point is that our banks can no longer justify offering lower than average deposit rates on the basis that they offer lower than average mortgage rates.
Did anybody say otherwise?Banks today have other funding sources than household deposits and many other revenue streams apart from mortgage lending.
You implied as much!Did anybody say otherwise?
Deposits are still the main (not sole) source of funding for Irish banks and depositors are getting screwed while the banks are making obscene profits.
No I didn’t! Seriously,You implied as much!
Of course we need a profitable banking sector. Again, nobody suggested (or implied) otherwise.A profitable banking sector is far likelier to support the real economy and develop new products for customers.
Agree with @Brendan Burgess I think there are limits to how much of a nanny state you should look for.
Brendan's proposals are about transparency & discrimination.....crossing the rubicon on pricing / bank windfall taxes etc. is a dangerous game.
The state's job is to be a referee....not a player in the market.........set transparency rules such that it allows easy comparison across institutions and remove barriers to mortgage switching. If super-normal profits emerge in the Irish mortgage market it wont be long before they are noticed and taken away via increased competition.
If you want 'lock-in' BOI & AIB's oligopoly here then just go ahead and start interfering in the pricing of product or arbitrarily taxing bank profits - not a single foreign institution would voluntarily walk into a lion's den like that & so the unintended consequence of such interference would be to reduce competition while creating a political football for future politicians to play with it.
Are we really expecting Irish depositors to trust an online platform that facilitates making deposits in minor banks they have never heard of in Latvia, etc?
The best buys section of AAM is vastly superior to anything the Competition Authority had on it's own website.
The Commission for Energy Regulation did take a policy stance and directly regulated the prices of the dominant agents. It kept the prices of the ESB and Bord Gais artificially high to encourage competition.
Applying the same logic to the deposit market, if there's a policy action to be taken it's to keep deposit rates low not to raise them.
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