Poll: Do you think a public banking model could threaten Ireland's elite lenders?

AIB, Bank of Ireland and Ulster Bank have a triopoly on lending to small Irish firms.

By Killian Woods Reporter, Fora

MINISTER MICHAEL RING made some bold statements in the Dáil last week when he said banks “are certainly not there for the people anymore”.

The rural and community development minister made the comments when he was asked for an update on the investigation into public banking being carried out by the government.

As part of the ‘programme for partnership government’, a commitment was made to look into the launch of a public banking model in Ireland. This included an investigation of the German Sparkassen model, which dominates SME lending in the country.

In contrast to commercial banking, public banking is largely decentralised. Each branch works largely independently and focuses on lending in their locality.

The report into public banking has been completed and is due for publication in the coming weeks, according to Minister Ring.

He added he would welcome any competition for banks since they “have certainly lost the sense of what they used to do” for Irish businesses.

In 2016, a report from the Central Bank showed that AIB, Bank of Ireland and Ulster Bank have a triopoly on lending to small Irish companies and control 95% of the market.

It is hoped that public banking could provide a credible alternative to Ireland’s main commercial banks and a pilot programme has already been suggested by German lender Sparkasse.

With that in mind, we’re asking Fora readers this week: Do you think a public banking model could threaten Ireland’s elite lenders?