Public Service Bank

Clown Shoes

Just been thinking about what tools might be available to the Public Service Unions other than industrial action.

It has been clear for the past 18 months that the Banking system is in a de facto state of nationalisation due to various causes (blame who you want, doesn´t really matter at this point). What does matter is who´s paying for it and it appears that Government´s policy is to hit tax payers and the Public Sector hardest.

What about the Public Sector Unions setting up a bank? They would start off with a clean balance sheet. I believe that capital requirements to set up a bank in Ireland are only approx E6 million. They could offer cheaper loans to union members and at the same time attract depositors away from banks that the government owns/has a share in. It would be a bank starting with no debt, no bad loans and a very loyal customer base. This of course would all be contingent upon a mandate from the unions´membership. It might make any government think very carefully about who gets what from now on.

Toughts?

ei.sdraob

a bank would always endup having to have liabilities and would only have about 1/10th of the deposits available on hand

tho a bank run by the beards :eek: would be something to behold

go ahead, i would love to see something like that only to see how a bunch of communists would run down a bank :P

a credit union would be closer to what you are thinking about, there are already a few of these CUs like on in the semi-state ESB

View

Clown Shoes wrote: »

Just been thinking about what tools might be available to the Public Service Unions other than industrial action.

It has been clear for the past 18 months that the Banking system is in a de facto state of nationalisation due to various causes (blame who you want, doesn´t really matter at this point). What does matter is who´s paying for it and it appears that Government´s policy is to hit tax payers and the Public Sector hardest.

What about the Public Sector Unions setting up a bank? They would start off with a clean balance sheet. I believe that capital requirements to set up a bank in Ireland are only approx E6 million. They could offer cheaper loans to union members and at the same time attract depositors away from banks that the government owns/has a share in. It would be a bank starting with no debt, no bad loans and a very loyal customer base. This of course would all be contingent upon a mandate from the unions´membership. It might make any government think very carefully about who gets what from now on.

Toughts?

Interesting idea - mind you the first thing I'd do, were I setting up a bank, is to lodge a complaint with the EU Commission about the banks here being in receipt of unfair state aid (which distorts the market and prevents new entrants). It'd be interesting to see the response to that!

joolsveer

ei.sdraob wrote: »

a bank would always endup having to have liabilities and would only have about 1/10th of the deposits available on hand

tho a bank run by the beards :eek: would be something to behold

go ahead, i would love to see something like that only to see how a bunch of communists would run down a bank :P

a credit union would be closer to what you are thinking about, there are already a few of these CUs like on in the semi-state ESB

There is the Civil Service Credit Union which has a very good balance sheet.

ei.sdraob

joolsveer wrote: »

There is the Civil Service Credit Union which has a very good balance sheet.

yeh theres few of them alright a I mentioned

tho having beards in charge of money as this guy is proposing is downrigh crazy, they had their snouts in trough for years, and what do we have now? doubled PS spending with no gains in productivity and lets not forget the beards 6 figure salaries and directorship of multiple bodies

antoinolachtnai

If you had a bank with a capital of 6m euros, you would only be able to lend 60m euros in total (probably less). If you made a 6 percent margin on loans (i.e., loaned for 5 percent more than you borrowed for) you would only have a gross profit of 3.6m euros a year. Out of that you would have to pay all the usual overheads of marketing, employing people, having offices and doing business, and you would also have chunky legal and audit fees (easily 1m a year including VAT). You would not be making enough money to provide a return on the capital or even to cover your costs and the whole thing would collapse.

12m or 15m is probably a more practical minimum capitalization for a bank, though 50m is more like what you would realistically need for it to have any chance to be worth your while.

Blackjack

View wrote: »

Interesting idea - mind you the first thing I'd do, were I setting up a bank, is to lodge a complaint with the EU Commission about the banks here being in receipt of unfair state aid (which distorts the market and prevents new entrants). It'd be interesting to see the response to that!

Their response would be something along the lines of "The EU has already approved all Aid/Assistance provided by the Irish Government to the relevant Banks".