Speaking at this year’s British Bankers Association Conference in London, Cable said that the Government must only take away the semi-nationalised banks’ aid when it can be sure that taxpayers will receive maximum returns from their investments.
He said: “There is a big issue over how quickly these banks return fully to the private sector. Historically, countries that have had these crises in the past – the Swedes, the Koreans, the Americans, the Israelis – they have demonstrated that it may take a decade to get these banks sorted out, to have the bad assets properly managed and to get maximum returns for the taxpayer.”
But Cable warned that the current Government may be in a “dash for cash” whereby it tries to get Northern Rock, RBS and Lloyds Banking Group back into private ownership as soon as it can.
He said: “You have to question seriously whether the Treasury is going to get maximum returns for taxpayers.”
Cable also warned that talk of a ‘recovery’ back to the highs of a few years ago might be foolish – he compared the banking sector to that of a heart attack patient, rather than one with “financial flu”.
He said: “After you have a heart attack you do not go back to normal. So we are also not going back to normal.”