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Church leaders unite to attack ‘shocking’ bank lending practices

Heads of the Catholic, Methodist, Protestant and Presbyterian churches in Northern Ireland issue joint statement comdemning the continuing failure of banks to lend to small businesses.

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by Tony Bonsignore on Jun 17, 2010 at 14:19

Church leaders in Northern Ireland have launched a bitter attack on the ‘shocking’ lending polices of some banks, claiming they are putting ‘decent’ businesses and people at risk.

Banks are failing to live up their obligations and failing to operate according to best practice, according to the leaders of the Catholic, Methodist, Presbyterian and Protestant churches.

The group is collecting examples of alleged poor practice, including cases where loan rates have been hiked, existing credit lines have been withdrawn, and an overall ‘culture of aggression and threat, where the only priorities are the banks’ priorities’.

In a statement the leaders of the four churches are now seeking urgent meetings with banking and political leaders to discuss the allegations.

‘We appreciate that the banks have a duty to restore strength to themselves and their sector overall,’ said the most reverend Alan Harper, Archbishop of Armagh within the Church of Ireland.

‘However, some of the experiences of businesses which have approached me are quite shocking, leading to instances of decent businesses, and decent business people being placed under immense pressure with the ultimate danger of closure and job losses which affect the whole community.’

Cardinal Sean Brady, Catholic archbishop of Armagh, said banks had a duty help out businesses following the taxpayer bailout.

‘Many of our banks are businesses that have received support from the tax-payer to get them through these turbulent times,’ Cardinal Brady said.

‘I think most tax-payers want to see the banks taking a similar approach to the businesses and indeed the homeowners who depend on them. Banks have a duty to society, to the social economy of persons as well as for the legitimate pursuit of their own profitability.’

A spokesman for the British Bankers’ Association denied the allegations, and said banks were committed to working towards the economic recovery.

‘The core business of banking is to make a return for customers by lending depositors' money to sound borrowers, for the benefit of all customers,’ he said.

‘Bank lending is not risk finance: it is debt finance. It is not the banks' money to risk; it is their customers. Therefore banks need borrowers to assure them they have a robust plan in place to ensure the money is repaid and will work with them to achieve this.

‘The coalition of churches understands it has not yet taken account of the banks' perspective, and has invited the banks to meet with them to discuss the issues their parishioners raise.'

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6 comments so far. Why not have your say?

Does it really matted what the church thinks? I'm sure they're right in what they're saying, but they need to understand the role they play in modern society - not much of one

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@Awol

I'm not religious by any many or means (ironic given my handle, but I can handle that), BUT it is essential we have some moral mirror to Banking and its practices of greed-stricken usury.

Some lending is good as it can work like an investment, but other forms of lending - as outlined in this article - have not a care in the world for their social implications.

As per much of this country these days, it's an "I'm alright Jack" attitude that prevails.

This might not be so relevant if it weren't for the squillions of taxpayers' dosh gone to bail them out for their nefarious and short-sighted practises... only for the banks to punish the little people, the little business and the little first time buyers!

It's frickin' disgusting, that's what it is.

All hail to the religious organisations of this country for making a stand and holding up a mirror to the wrongs.

Pray we may find a better path.

If not, we sew the seeds of darkened, economically-imploded kismet.

report this

@Awol

I'm not religious by any many or means (ironic given my handle, but I can handle that), BUT it is essential we have some moral mirror to Banking and its practices of greed-stricken usury.

Some lending is good as it can work like an investment, but other forms of lending - as outlined in this article - have not a care in the world for their social implications.

As per much of this country these days, it's an "I'm alright Jack" attitude that prevails.

It's frickin' disgusting, that's what it is.

All hail to the religious organisations of this country for making a stand and holding up a mirror to the wrongs.

Pray we may find a better path.

If not, we sew the seeds of darkened, economically-imploded kismet.

report this

Does "Awol" really expect us to believe that he considers the representatives of 85-90% of the population of a particular region of the UK as having not much of a role to play in modern society? For that is what he has actually said.

I take my figures from a joint publication of Northern Ireland's two universities (see http://www.ark.ac.uk/publications/updates/update41.pdf). Figures for religious affiliation at the 2001 census show 90% of the NI population affiliated to the 4 churches mentioned in the article. A 2004 study by the universities showed the figure at 85%.

Let's even admit that the figures might have been overestimated and say the figures might be as low as half that. That's still more than any single party in the recent general election polled. I think the role of the 4 churches mentioned might be a little more than "Awol" is prepared to admit. (For the record, I belong to none of the 4 churches mentioned.)

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If the churches have a view they can lend their own money.

The C of E did that of course and lost a packet so what do they know about what is, or is not, a decent business!

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Rob Morrison

Jun 20, 2010 at 22:50

I seem to remember churches getting into the stock market in a big way, a few years ago, on the expectaton of making money. Where is the difference?

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