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Ethics are now easier to stand by

NOT SO long ago, retail banking was a local or, at best, national business. Banks like the Ulster, Clydesdale and Yorkshire were independent, with boards of governors drawn from among the local great and good.

Now the Ulster is owned by NatWest and both Clydesdale and Yorkshire by an Australian banking group. "The whole banking system, and increasingly that for other financial goods and services, has been globalised," said Glen Saunders, the managing director of Triodos Bank. "Most `local' banks are part of huge, international groups."

Information technology has accelerated this change, giving "convenience" banking with facilities ranging from cash machines to Internet transactions. But it also results in huge volumes of money circulating in the world's financial markets. This money pauses neither for rest or sleep, nor does it judge right from wrong. Taking part in this system seems unavoidable, but raises difficult questions of conscience for the ethically minded. "In reality, no major bank would pass even a weak test on ethical and ecological grounds," Mr Saunders said. "They all stand morally, though not legally, condemned."

The Co-operative Bank is one institution that tries to buck this trend. As many as 40 per cent of its new account holders choose its services on ethical grounds and since 1992, the bank has consulted its customers on which ethical policies they would like followed.

The Triodos Bank helps finance the development of small businesses in the Third World countries. It does not offer full current account facilities but its Tessa accounts pay attractive interest rates.

Shared Interest operates in the same field, but as a friendly society.It accepts deposits and re-lends to organisations run for the benefit of disadvantaged producers in Third World countries. A spokesman, Colin Crawford, said: "This is not just a hand-out to the needy, but a way of helping them to work their way out of rural poverty. Put in the same position, which would you prefer?"

Co-operative Bank, 0161 832-3456; Triodos Bank, 0117 973-9339; Shared Interest Provident Society, 0191 233-9100