"Profits in the billions underline the vital role of banking in the economy". It should not surprise that this is a headline from today's Financial Times. It continues "This year the UK banking industry is set to break records again with profit of about £34bn – or more than the gross domestic product of Croatia. Next week, Barclays is expected to report pre-tax profit of £5.2bn and Lloyds TSB £3.35bn".
Gone are the days when a bank existed for its customers. Perhaps those days never existed. My parents, now in their 80's cannot deal with the terminals in their local branch, and while I can cope with that, other "progressive" features trouble me.
In January UK banks reduced interest rates to savers, driven not by a change in the base rate, but seemingly for no other reason than it was the begining of the year and, acting in concert, they could get away with it. To compound the insult, my bank wrote to me weeks later with a gloss that I am fortunate to have so many choices. Well, a choice is to change accounts, but to accomplish it is another matter!
On my secondary account I am locked out because I have not used it for some time, and despite a visit to a local branch with passport, statements, I remain locked out. Calling the help-line, I point out I have verified in person who I am and have the appropriate numbers, and politely observe that it is my money in the account. To no avail: a flag is set, and access cannot be granted.
While I can live with this delay, it brings home that banks can shut you out from your own money, and that our implicit trust in banks may be misplaced. The onus is on you to regain access. They are a business to make profit for their shareholders – that they have "high-street" customers is an anachronism they might like to be rid of. Perhaps our grandparents kept cash under the bed for good reason!
So, what do banks do with that hard-earned profit?
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