So it’s time to return to routine and reality. The most recent official figures show that Britain’s bank are directly responsible for more than a third of the country’s economic slump since September 2008. They say the UK economy is currently 4% smaller than its peak in March 2008 and 2.8% smaller than in September 2008 when Lehman Brothers collapsed.
The Telegraph reports of the 2.8% fall, the contraction in banking activity has accounted for one percentage point, analysis of Office for National Statistics (ONS) figures shows.
The impact banks have had on the economy is completely disproportionate to the industry’s size, the paper reports. Banks account for just 5.1% of national output, but are to blame for around 35% of the national decline even excluding the knock-on effect of tighter credit on businesses and households.
So far this year, the banking industry has shrunk by 2.6%, which follows a 5.1% fall in 2010 and 7% drop in 2009. However, despite the banking industry’s massive decline, an estimated £6.7bn of bonuses were paid in the City of London in the 2010-2011 financial year, according to the Centre for Economic & Business Research (CEBR). That was a fall of 8% on the previous year, but basic pay jumped 7%.
Not sure what to make of it all? It is not clear or simple but we need banks to provide for the flow of money though our global economy. What can be very unclear is how to make the most of your money and your capacity for investment. Enable IFA’s in Bishop Stortford specialise in trying to make sense of it all come and talk it through with us, if nothing else you will be able to get bashing banks off your chest!