Editorial: Paying the piper

23:41 9/2/2019 - Πηγή: Τα Νεα

If there is one lesson the government should have learned over the four years it has been in office is that the banking system is not the place for populist experiments.

It should have realised that banks are not voracious bankers and handsomely paid golden boys, but rather small and larger deposits. It is for them that one must jealously guard the

banking system.

Secondly, a healthy banking system is a precondition for economic growth. The banking system is one of the basic pillars of the market economy. Banks which are overburdened by non-performing loans have a limited lending capacity. That means that the circulation of money becomes difficult. This is money that businesses need to grow and to thereby create new jobs.

Unfortunately, the ills of the past have not become a lesson. The banking system took a blow in the first half of 2015 which was sealed by the closing of Greek banks and the impositon of capital controls.

The shock was so powerful that banks lost a substantial portion of their share value. They were saved only thanks to the recapitalisation – the third such in a few years.

Despite this bitter experience, the government seems to be playing with fire again. Instead of confronting the burning issue of non-performing loans in a drastic manner, it is testing the limits of the system with its policies.

Once again, the government is overlooking the fact that it is the taxpayer who always pays the piper in the end.