subject: The Economic Crisis. The Banks, Heroes, or Villains? [print this page] The Economic CrisisThe Economic Crisis. The Banks, Heroes, or Villains?
The Economic Crisis.
The Banks Heroes, or Villains?
Has the economic crisis been caused in part through the irresponsible or greedy behaviour of Banks worldwide and if so how much are they contributing to the global efforts to recover from seemingly the biggest worldwide upset since the great depression of the 1920,s?
I can only comment on events taking place in Spain, because that is where I live, but the reaction of the banks in Spain seems to vary from bank to bank. Clearly Spain is suffering a particularly painful recession with the highest levels of unemployment in Europe consequently a great many people have experienced dramatic reductions of their incomes and their ability to meet their financial obligations of hire purchase and mortgages that were taken out during the days of plenty.
Now the general advice is that anyone experiencing financial difficulties should as soon as possible discuss their changed economic situation with their bank, or the holder of their loan, or mortgage in order to agree a new package of repayment terms that reflects their changed circumstances. How are they fairing?
I have a colleague that works in the financial sector in Andalucia, well actually the Costa Del Sol, an area that is probably at the epicentre of the financial meltdown here in Spain and it seems that the helpfulness, or willingness of banks in agreeing new and affordable packages that reflect their clients changed circumstances varies from bank to bank, or from very helpful to an almost Ostrich type reaction of aloof disinterest.
This seems to me very strange, has not the banking system received huge government help and bailouts and should they not have a moral obligation to at least try to accommodate those clients that are trying their best to fulfil their financial obligations and not lose their houses?
One of the reasons for the huge levels of unemployment here is Spain can be traced back to the totally unsustainable housing boom and the huge stock of unsold flats and houses (again supported by the banks making available the finance), so quite clearly the repossession of homes should only be considered by the banks as a last resort and if all other options have failed. The very last thing Spain needs right now is for the market to be flooded with cheap repossessed houses, but that is what is happening!
Perhaps it would be useful to produce lists of those banks that are trying their hardest to help find a means for their clients to repay their debts, through extended periods of payments, or other means and those banks that seem to be both rigid and un-flexible in their attitude and would seem to prefer the repossession option to trying to find alternative payment methods for their clients.
Unfortunately the banks taking the latter course of action are in effect worsening the crisis for everyone in Spain, so it would seem clear that whilst some banks are heroes, others are villains and perhaps knowing who are the good guys in this situation and who are the bad guys could be helpful information for those people struggling right now.
