A new banking model that involves a network of regional public banks that combine with credit unions and post office has been proposed by the Public Banking Forum of Ireland.
The PBFI said its suggested alternative to the traditional banking system is designed to “address the urgent need for an Irish banking system that serves the public interest”.
The alternative banking model would comprise a network of new regional public banks across the country, along the lines of the German Sparkasse banking model.
These public banks would use the existing branch infrastructure of credit unions and post offices, while there would be a ‘Central Service Provider (CSP)’ to support the public banks.
It said its new banking model “offers a full-service alternative to the present pillar bank model”.
According to the PBFI, SBFIC (German’s Savings Banks Foundation for International Cooperation) has estimated that the public bank network could be established for a one-off amount of less than €150m.
The PBFI said pillar banks in Ireland hold a market share of around 95%, compared with an equivalent market share of 12.5% in Germany for pillar banks.
