A church leader called today for a new banking morality to end a process which has "driven hard-working people to the point of suicide".The head of the Church of Ireland said the consequences of the recession were devastating for those forced into unemployment or faced with the collapse of their companies.
The Archbishop of Armagh, the Most Revd Alan Harper, also told the General Synod in Dublin's Christ Church Cathedral that banking licences should be revoked from any institution which does not perform with social responsibility.
"We cannot allow hard-working people to be driven to the point of suicide by institutions parts of which those same desperate and distraught people actually own," said the Primate.
In his presidential address, Rev Harper said the effects of restrictions in bank lending have been disastrous for small and medium-sized businesses, especially in the construction sector.
Many employers have been forced to the wall, he added, with long- established firms laying off its workforce and ceasing trading.
Rev Harper stated that asset-rich but cash-poor businesses, often described by the banks themselves as their core customers, are being starved of the cash required to enable them to trade, yet these same small and medium-sized businesses are the backbone of the local economy.
"Scandalously, the people who paid the price for the bond market gambling that brought down the financial system were the taxpayers," he said.
"The people who walked away virtually unscathed, in some cases much richer, were the bankers and traders who invented the products and the system."
Rev Harper told senior clergy at the start of the three-day Synod that the first obligation of retail banks must be to the customer.
"Banks and financial institutions are not themselves wealth creators. We need them to act morally, consistently and responsibly for the greater good of society," he continued.
"We need to be able to trust them, including trusting in their objectivity and reliability.
"That kind of banking may be dull; it may not have the potential for massive trading highs and lows, and the bonuses that go with them, but nor does it have the capacity to destroy the lives of ordinary people when gambles do not pay off."
Elsewhere Rev Harper said he had observed a radical departure from the ethical and moral values which used to inform banking towards a culture of the relentless pursuit of profit at any price.
"It is as if the retail banking sector has been morally compromised by association with the culture of investment banking," he continued.
"Now, however, the majority shareholder is often the taxpayer."
The churchman said there was no shareholder value for the taxpayer if banking policy puts people on the dole, causes significant loss of tax revenue, and inflates the cost of the social security system.
"We require a completely new banking morality that takes full account of the social obligations of financial institutions and that insulates ordinary people and businesses from exposure to the risks of investment banking," Rev Harper added.
SIC: II