IN spite of romantic notions to the contrary, there is no evidence that history repeats itself with any degree of precision.

We should therefore be reasonably safe from a repetition of the sort of banking crisis which blighted the Island during the late 19th century if, as has been suggested, a Jersey bank were set up.

But if the spectre of past failure in respect of small-scale local banks is not a concern, other issues most certainly are. As so many economic pundits have asserted, the present global conditions have never been seen before, so it is hard to determine whether a Jersey bank would enhance or merely complicate the Island’s chances of weathering these recessionary times.

It is, of course, necessary to consider the shape that a Jersey bank might assume before we go any further. As has been suggested by proponents of the bank and those commenting on its feasibility, such an entity would have far more in common with a minor UK building society than a major high-street player such as HSBC or Barclays, let alone a truly national bank.

The point of the proposed organisation would be to accept deposits from Island businesses and individuals and to lend on a purely insular basis. In restricting activity in this way it would be free of the necessity of mirroring sterling interest rates, with possible benefits in the present financial climate for Jersey borrowers and savers.

As some of the UK’s very local building societies illustrate, the ‘small is beautiful’ model, coupled with ‘basic’ banking, can work. These societies can also appeal to customers who value high levels of personal service and the idea of banking in the community.

However, just how well this cosy version of banking would match client expectations in the Jersey banking environment, where sophistication rather than simplicity is the rule, is more or less anyone’s guess.

Whether the States decide to establish a Bank of Jersey must depend not on whether it can be done, but on whether there is any good reason for doing it. As matters stand, the jury is very much out, and a much sturdier case for our own bank will have to be made before we lurch ahead into a new and unpredictable era of people’s banking.