Analysis: There is a certain sameness to most comments made about the Irish banking sector these days. More competition is needed, profits are the highest in Europe and consumers feel they're not getting a good deal but are too lazy to do anything about it.
Banks get annoyed about the general theme, arguing that they have taken strides in addressing the competition but consistently fail to get credit for it.
In such a situation, the main benefit of a neutral study such as that released yesterday by the European Commission is that it places Irish banking fairly in context with its peers.
Perhaps unhappily for banks already used to deluges of bad publicity, the most startling of the Commission's findings is that Irish banks are (and have been for some years) the most profitable in Europe.
Specifically, the pretax profits made by the Republic's banks represented more than or close to half of their total retail income in the years between 2002 and 2004.
The percentage climbed each year according to the Commission's research, with the next most profitable banking sector found to reside in Latvia. Banks in Spain, Finland, Sweden, Denmark and the UK also do pretty well, but their profitability ratio is closer to 40 per cent than the Republic's 50 per cent. The EU average was 25 per cent.
It is a difference that should pique the interest of consumers and businesses across the State as they wonder at the cost such profits must carry for them in higher margins.
The Irish Bankers' Federation (IBF), which forms an umbrella over the domestic sector, was in predictably well-rehearsed form when dealing with the findings yesterday. Eimer O'Rourke, the IBF's head of retail banking, said the profitability of Irish banks was merely a reflection of the buoyancy of the Irish economy over the past few years.
This theory carries some credence, with Germany (where the economy has hardly boomed of late) having one of the lowest profitability ratios in Europe.
Ms O'Rourke also pointed to a 2005 Cap Gemini report (where the Irish research was funded by the IBF) that found that the Republic was the third cheapest out of 20 countries for day-to-day banking. She said that while the sector was never complacent, it had made progress in competition over the past couple of years.
It would be unfair to say that things have not moved on since the Competition Authority told us in 2004 that Irish banking simply wasn't competitive.
New retail entrants - notably Danske and Bank of Scotland (Ireland) - have certainly shaken up the market, with the banks' own switching codes making it easier for consumers and businesses to move their accounts. Free current accounts have also become widely available.
Detail contained within the report suggests, however, that current accounts are only the start of Irish banks' profits. The research shows that in 2004 they had a gross income (or charge) of €668 per consumer loan they issued. The EU average was €367.
Credit cards brought in an average charge of €105 in the Republic, compared to an EU average of €65. On the other hand, Irish banks fare relatively well when compared to the EU average for mortgages and current accounts, where competition has been strongest.
For small and medium-sized enterprise (SME) current accounts, they are a shade above the EU average gross income but they come in €228 below the EU average income of €2,219 for SME term loans.
A spokesman for the Competition Authority yesterday said the body was "not particularly surprised" that Irish banks had ended up at the top of the profits table. "Without doubt, there's insufficient competition in the domestic market."
