| Wilson chides analysts, calls for VAT reductions |
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Stock analysts and market commentators who last year had made internet banking ‘flavour of the month’ were chided by Martin Wilson, president of the Institute of Bankers said at its annual dinner in November.
Wilson told the assembly of bankers and their clients at the Burlington Hotel, ‘Now these very same people are suggesting that an integrated approach, extending the financial services providers’ existing brand, is the preferred model.’
‘This highlights the difficulties of predicting future ‘winning’ strategies... if it is difficult for the analysts, how much more difficult is it for those who have to make significant investment decisions in this rapidly changing environment’.
Wilson said that in banking it was likely that a multichannel provision of services would be needed. The key challenge, he said, was meeting customers’ changing needs ‘in a fashion that will delight them’.
Banks were in agreement, Wilson said, with ‘the majority’ of the recommendations and conclusions of the Strategic Review of the Banking Sector carried out for the Minister for Finance. However, he said that any policy should not place domestic financial institutions at a competitive disadvantage to the ‘aggressive competition the banking sector is facing’ from ‘overseas and new entrants’.
Wilson called for an extension to the banks of the exemption from DIRT for credit unions. In a fiscal area where he said ‘progress has yet to be made’, he called for Ireland’s VAT rate to be brought into line with EU average. This would imply a reduction of 2-3 per cent in the main VAT rate, which would benefit banks since they cannot reclaim VAT on input costs.
A personal plea to address issues of social exclusion was made by Wilson. He said that it was ‘one of the biggest threats to sustained growth’. ‘If the gap between the ‘haves’ and the ‘have-nots’ is to widen further, this will in the long term lead to an economy based on a system of social injustice which will eventually undermine the very basis of what has been built up since the foundation of the state’.
Earlier, the Minister for Finance, Charlie McCreevey delivered the traditional address to the Institute, reminding the bankers that he had decided to ‘relieve them of the burden’ of tracing the owners of dormant accounts. The Minister said banks could have done more in the area.
Legislation on the transfer into State management of dormant account balances is currently being drawn up.
The Institute dinner, a long-standing event, was attended by many hundreds of bankers and their customers. |
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| Article appeared in the November 2000 issue.
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