9. Will the First Minister provide an update on the Welsh Government's proposals for a community bank for Wales? OAQ54058

Llywydd, we are in dialogue with a number of stakeholders to test the feasibility of establishing a community bank. The work will be led by stakeholders. They will prepare a full market assessment and business plan, and the intention then is to submit an application for the establishment of a community bank for Wales to the Bank of England.

Thank you for your answer, First Minister. In your manifesto to become First Minister, you set out proposals to support the development of a new Wales-only community bank, with branches open to customers for a face-to-face transaction service, before the end of this Assembly term. Now, the Economy, Infrastructure and Skills Committee has been doing some work in this area and, certainly, the evidence to date has suggested that it is a highly complicated process in terms of regulation to open a bank in the period, perhaps, that you've suggested in your manifesto to become First Minister. They've also talked about the complications of the large amount of public subsidy that would be required to deliver the bank as well. So can I ask you: when do you expect the first community banks to be open, where would you expect them to be located and how much public subsidy will be required to deliver your manifesto pledge?

Well, Llywydd, I am very committed to exploring the potential for a community bank for Wales—a bank that would be ethical, relationship driven, customer owned and that would help us in Wales to tackle some of the detrimental impacts we know there are when a bank branch closes. Lending to small and micro industries in the catchment area of a bank branch goes down by 60 per cent when a branch closes, and we have the phenomenon of people not being able to have a bank account at all and the poverty premium that that involves of an average of £500 a year. So there is something really big to play for here. 

Russell George is right, it is complex. There are others who are further down the track than we are—in London and in Avon in the south-west of England. We are in discussions with the Scottish Government about actions that they are taking, too. I look forward to the report of the committee. But the model that has been put to us, developed by the royal society of arts, does not involve large sums of public money as a subsidy. In fact, when I met with representatives of the RSA who have been leading this work, they are at pains to say to me that the last thing they wanted was the Welsh Government to be putting large sums of money into this bank. It's a community bank. It has to be owned by a much wider range of stakeholders if it is to succeed. 

So, there's detailed work to be done, and some of the questions I was asked, Llywydd, are premature and cannot be answered today. But, the work is going on. It's going on with a very committed group of people here in Wales, with expert help from outside Wales. And if we can make it happen, then I think it has really exciting possibilities for communities right across Wales.

Thank you, First Minister.