OPINION/Bill Murdoch: The ferocity of the attack would have made a normal person run for cover, at least until the heat wore off. That attack is surprising for two reasons.

First, it was made by the Irish Bankers' Federation (IBF), a conservative, and normally fairly staid group, representing the Irish banks. And second, it was targeted against the well-respected director of consumer affairs, Ms Carmel Foley, and her office.

The trenchant language used reflects the bankers' outrage at her submission on the banking industry to the Competition Authority.

It is worth repeating some of the federation's case: "We know of no other instance in which a statutory regulator has issued conclusions that have been based on such inadequate or inaccurate information. We can only conclude that you are not willing to take account of any reasonable arguments put forward by the industry.

"We believe that such an approach is in fundamental conflict with your position as a servant of all taxpayers, including banks, who have a right to expect that you will produce a fair and balanced report that is based on established facts and up-to-date statistics."

Such words could hardly have been harsher. Ms Foley expressed concern at the "personalised nature" of the attack.

Nevertheless, she immediately responded to the 10-plus points, arguing the submission was based on "careful research" and took into account "both the needs of the consumer and the legitimate concerns of any service provider".

So which side is correct? Scrutinising the rigid stances confirms that statistics can give a prop to both sides of every argument.

The Office of the Director of Consumer Affairs (ODCA), in its submission, says it is incorrect to suggest that \ charges have remained static since it assumed responsibility.

The IBF countered that the cost of a basket of the most popular (my italics) transactions between 1994 and 2003 increased by an average of 3.1 per cent, or was "effectively static when compared with the overall inflation of 29.5 per cent" (2.95 per cent annually).

That seemed to prove the bankers' point. But then the Ms Foley's office said it had dealt with more than 100 notices to increase existing charges since the end of April and pointed to one institution which increased its fees and charges by 29.5 per cent in 1997-2002 - an annual increase of almost 5 per cent.

That is a huge difference but could never be validly used for comparisons.

The consumers affairs office also submitted that Irish banks are at the top, or near the top, of world bank profitability (not supported by statistics in its reply to IBF).

The IBF produced a league table which disagreed and shows this State ranked ninth (excluding foreign exchange losses) among 55 banks which participated in a survey. This survey of 23 countries was based on a return on assets in 2001. A recent OECD study is expected broadly to confirm these figures and concur that Irish banks are very profitable relative to others but not at the top.

A very valid contentious issue is the exorbitant interest charged on credit card balances, which Ms Foley's office puts at an average of 18-19 per cent (this was based on the largest banks) here compared with an average EU rate of 12 per cent (continental banks also charge an annual fee).

The IBF disagreed with both figures, saying the average rate was 16.4 per cent based on a table in the consumers affairs publication. But surely a more accurate figure would be the average per customer? That would bring it closer to the consumer affairs office figures. The average would be even higher if the Government levy of €40 is taken into account. So much for statistics

The difficulty in switching accounts from one bank to another is again a live matter. Ms Foley's office was right to ask the IBF to introduce a voluntary code similar to Britain. But, in a regressive stance, the bankers are not going to move until after the Competition Authority makes its report.

Why do these professional bodies, like the accountants, only move when they are forced to? The bankers argue that non-bank parties have created greater barriers such as duties on credit cards, legal fees and Government duties on mortgages.

On the regulation of bank charges, vigorously opposed by the banks, Ms Foley contended such restrictions had not prevented foreign institutions from entering the market - Bank of Scotland, for example.

The IBF was right to point out that none of the new entrants is in the current account market where the impact of price control is mainly felt. But some institutions, according to the Office of the Director of Consumer Affairs, have cited prohibitive costs of becoming members of the clearing system and the agency fees associated with the money transmission services as being barriers.

Ms Foley and the IBF have also become embroiled in an unseemly row over whether or not the Central Bank and the Department of Finance are reviewing the retail payment system; she says they have been, IBF says they are not. She appears to be correct because the research on this is ongoing.

The umbrella group for the cheque-clearing system is the Irish Payment Services Organisation (IPSO) and it is also locked into a dispute with the director over the submission to the Competition Authority. The IPSO refers to some "misleading" assertions and "surprising omissions".

That institute has very valid complaints in terms of facts but Ms Foley has yet to respond.

There are a lot of misconceptions about the IPSO. It operates four separate companies - paper clearing; electronic clearing; inter-bank settlements; and laser cards. It is not directly controlled by the big two banks; it has 10 directors, eight of whom represent individual banks, one represents the Central Bank, and chief executive, Mr Stewart MacKinnon, is the other director. It is limited by guarantee so there is no shareholding.

However, in the event of a vote, AIB and Bank of Ireland dominate as votes are based on volume of business. Mr MacKinnon stresses there has never been a vote as consensus rules. And, today, in a move away from tradition, the IPSO will elect two independent, non-banking professionals to its board. It will also invite representations from non-banking money payment systems to join its network as members. These moves are welcome.

The IBF has served the economy (and itself) well. The Competition Authority will have to balance the needs, and rights of banking customers with the legitimate demand from the bankers, and the necessity of retaining an efficient and profitable banking industry.