All true, and good posts from Michael in Austin, kenrigg and Mark in Nottingham.

This is less about people being unable to pay (mostly, they try very hard) & more bankers/traders not knowing what the things they sold are worth.

Relationships are great, but can they compete in an internet world?

Ali, S Yorkshire, UK

Good character is not a good indicator of ability to repay - what if that nice person loses their job? Also, we all demand 'equality', not someone's discretion.

Hard and fast rules like 2.5x income are crazy - things like age, # dependents, current indebtedness, etc, are much more important...

Mark, Nottingham,

What price experienced personnel, the banks fired most of them in late 1990's. Then hired inexperienced science graduates to write programs in trading rooms, computer says sell etc., FSA is the same a wealth of experienced bankers out of work, what do they do hire graduates, no wonder can't cope

Alan, Preston,

This governement is currently dismantling the legal professions, commoditising they call it. Perhaps our MPs ought to be asking whether it is in the interests of society as a whole to have those who give legal advice think in the same way as those who sell baked beans

Peter Ryder, Middlewich, UK

Now you've got me singing the "Fidelity Fiduciary Bank" lyrics from Mary Poppins!!

"If you invest your tuppence
Wisely in the bank
Safe and sound
Soon that tuppence,
Safely invested in the bank,
Will compound
And you'll achieve that sense of conquest
As your affluence expands"........

Barbara, Baltimore, US

Is it a coincidence that since 1997, 'relationships' have taken second place to 'transactions' in most spheres of people's lives now ? Labour has created Breakdown Britain, a broken society in financial, emotional, family, cultural and moral terms.

Labour have got a LOT to answer for.

Rick, London, England

An old banking fraud, from America, which takes place in three stages: 1. Make illegal profits (on sub-primes) 2. Wait for the market to collapse, and short the market 3. Wait for market to bottom, and buy it cheap. Same as Nathan Rothschild's technique in 1815. Coincidence, or repetition??

H. Grattan, Sussex, UK

A wonderful article. A major problem for Britain is that you can substitute any of the professions; older doctors look at the person, younger ones at the targets. Nursing and teaching are just the same. It's partly an ageist thing, but also an ignorance of the value of experience.

Alastair Lack, Salisbury, UK

It seems banks want it both ways - high interest rates for unsecured debt and the ability to repo a house for said debt.

It seems a little harsh but it does rebalance the books for those who wish to live on other people's money without repaying it....

Mike Carter, Bristol,

The web site of Her Majesty's Courts Service states explicitly that 'You should note, however, that a charging order does not compel the judgment debtor to sell the property.'
Are you wrong, or are they?

Joseph Bruno, London,

Extend this analysis a little. Lehmans grew exponentially over about 10 years. Other banks too. Where did they get their staff ? Outside banking. Can academic qualifications subsitiute for experience ? No. When HSBC had early, vast sub-prime losses, who else looked for their own ? Nobody.

kenrigg, Hong Kong,

A charging order is not a "loophole" at all. It is court granted with debtor's knowledge.

I let my flat to a couple who did not pay 6 months rent, used as a deposit to buy a house. I obtained a charging order on it and when they sold 2 yrs later I was reimbursed (albeit with no interest or costs).

Simon, Mons, France

The banks could trade normally again tomorrow , they choose not to because they can't believe the amount of money being thrown at them from the government. The money men will depress the market until Gordon say's no more .
Britain will be bankrupt for the next 25 years .
The banks will not ..

Nick Dixon, Sutton Coldfield, England

I left UK 3 years ago to retire to Finland. Before I left almost every day a credit card offer came in the post . I went to my bank in Finland for a credit card. just to make it easy to book air flghst to the UK, I was turned down. Income too low! No Finnish banks are in need of rescue. Wonder why?

john, kouvola, finland

William Rees-Mogg has very articulately summed up the decline not only of banking standards,but of business in general.

Tony Renney, Workington, UK

I agree. Around 20 years ago Bank Managers and those who gained experience by coming up through the ranks left or were replaced by bean counters and people successful in other fields who only cared about profit.

Banks are not shops and CEO's should realise that - their customers have...

Bruce, Skipton,

Victorian values hurrah. Except, the gold standard also ruined British manufacturing but no bother, the banks were sound (apart from the odd crisis such as 1878 when the Glasgow Bank and the West of England Bank collapsed).

clifford, reading,

As an ex branch banker of nearly forty years I have seen banking change from being customer orientated to target driven. It became a question of making the targets set for you or you didn't get a bonus, or you were out of a job. The result was many branches sold inappropriate products.

David Moss, Wimborne, England

Banking failure, financial crisis..nothing new. During the 19th century we had major banking crisis in :
-Australia: 1826, 1828,1843 and 1857
- USA: 1819, 1837; depression from 1873 till 1896.
- UK : 1847, 1866

Moral responsability and money cannot go together,as history shows.

George, SA

Georges Geldhof, Riyadh, Saudi Arabia.

How many of us have walked into a bank to have a pushy salesperson try and sign us up for a credit card? it seems that modern banks have only been interested in volume sales never mind the risk, the same applies to loans and mortgages. Now the results are being reaped.

martin, Manchester,

I'm sure that now the Midas-like banks have found a way of turning unsecured debt into secured debt, we can look forward to credit card interest rates coming down to around 7%.

Andrew, London,

May I congratulate you Mr William Rees-Mogg for this article. I just have 2 questions, do you think that this new generation of Bankers you have mentioned will understand what you are talking about ?
Secondly do you think they know who you are talking of when talking of Queen Victoria ?

E. Bee, Toulouse, France

With the greatest respect to William Rees-Mogg whose values are spot-on.

Once the mutual respect between client & bank is eroded & lost it can never be recovered. Customer should move to another bank or Bank should close its doors.

Ex advisor to BBCI. http://www.factbook.net/bcci.php

Richard, Stanstead Abbotts,

Very good piece, but is relationship banking still possible in the age of debit cards, ATM's, and electronic transfers? Because of the electronic "convenience" factor I may get into my bank only a couple of times a year, and there is always someone new.

Michael, austin, usa

I couldn't agree more.

Unfortunately Banks and many other large corporations no longer see customers as people they need to build a relationship with. It's more like they view us as cash on legs

John Goode, Welwyn Garden City, UK

I really don't understand how an unsecured loan can be turned into a secured loan. There has always been a clear stated difference between the two. Whatever loophole these banks have found should be plugged immediately. It only requires will on the part of the government surely.

Lin, London, England

Why would trust an institution that is simply looking for a way to rip you off in everything it does. Take currency exchange -- a 10% or larger difference between buying and selling rates and they have the nerve to advertise 'no commission exchange'.

M smith, Bangkok, Thailand

When I took out my first mortgage (London, 1985), the 'old rules' were still in place: 2.5 times single income, 3.25 times joint, 10% deposit.

How Victorian is that?

David Ballantyne, Raleigh, NC,

Absolutely first-class writing. Unfortunately, the world is driving itself away from relationship banking, and from relationships altogether. In my country, specially after the 2001 banking crisis, banks never fully recovered their customers' trust.

Gonzalo, Buenos Aires, Argentina