Thomas Jefferson once said: “Banking institutions are more dangerous to our liberties than standing armies.” While these words may resonate strongly with many people today, it is easy to forget that financial institutions have the power to create a lot of good for society. The capacity for soundly managed banks and markets to support the generation of wealth in the economy could never be matched by the public sector. That is why the government has a policy of supporting a return to an effective commercial banking sector, rather than nationalisation.

Banks best fulfil their role when they allocate capital on the basis of a sensible assessment of risks and returns. By providing the finance essential to expand businesses, create jobs and purchase homes, banks underpin the growth and functioning of our economy.