Using banks: The effect of national attitudes to public intervention in mortgage lending and eviction in French and English law

Purpose – The purpose of this paper is to show the different attitudes to bank ownership and regulation, residential lending and eviction in the UK and France, with their effects in the credit crunch and how these factors are connected. UK noninterventionism stems from a history of private banking, where competition produced plentiful finance but high risks for borrowers, where eviction is certain and fairly quick, but not necessarily disastrous for borrowers within a flexible system. The French history of postwar interventionism for reconstruction and cautious banking has had successes and failures, culminating in largescale special loans to lowerincome borrowers, improving lending liquidity and stability. The French lower lending levels, intervention and caution can be partly explained by the disastrous effects of French debt and eviction processes on borrowers, but with overlay of delay and social protection. Design/methodology/approach – The paper uses a historical institutionalist approach, calling on historical materials, statistics (where available) and the law and procedure of banking, mortgages, eviction and insolvency. Quantitative comparison of mortgage evictions is difficult, but procedures illuminate this. Findings – National approaches to banking are path dependent and this effect is underestimated, particularly concerning attitudes to public intervention and eviction. Awareness of these connected effects could improve comparative research to assist lending to lower income groups, particularly concerning special French loans. Practical implications – This can improve openmindedness, and promote ideas to house young people rather than simply calling for heavy regulation in the UK, or criticising French interventionism. Originality/value – Comparative evictions related to the history of banking intervention are considerably understudied. The paper addresses the issues.