Thursday, November 10, 2005

Why Can't We Have More Intelligent Legislators (Part 2)

In a story of today's South China Morning Post, it reported that:

"Three note-issuing banks were urged yesterday to take their social responsibilities seriously after it was revealed they had cut the number of manned branches by 27 per cent over the past four years."

These banks were urged by our "honorable" but ignorant + stupid legislators to take up social responsibilities by opening branches manned by real persons. In this internet age, where most of the bank customers use the internet and the telephone instead of going to a bank personally, a branch manned by real persons means one and only one thing: higher costs. So it is only understandable why in a competitive banking sector like Hong Kong's, banks consolidate their branch networks in order to minmize costs.

Costs saved from the closing of uneconomical bank branches, by the way, will be passed on to the customers through more up-to-date, more secure, more advanced internet banking facilities in competitve banking environment. And what's wrong with that?

Forced to do so, assuming all banks have to set up these uneconomical new branches in order to fulfil their "social responsibilities" and other factors affecting the banking industry have not changed, what will happen is that banks will need to charge higher fees for services provided to stay afloat.

When this happens, I am sure these "honorable" legislators will again cry foul, saying the banks are ripping off their customers.

In other words, our ignorant legislators believe that services can be offered for free. My question is: if our "honorable" legislators are out to take care of the "social interests", why don't they open a bank themselves that offers everything for free?

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