July 17, 2024
RUTH SUNDERLAND: Curse of the bad bankers

RUTH SUNDERLAND: Curse of the bad bankers

RUTH SUNDERLAND: Curse of the bad bankers

RUTH SUNDERLAND: Curse of the bad bankers


Why is Britain cursed with bad bank bosses? Alison Rose’s defenestration is a shocker because until her failure of judgment over Nigel Farage, she was one of the good ones.

She delivered the numbers and showed admirable determination to break with NatWest’s toxic past. Claims have been made in the Left-wing press that Rose was a victim of sexism and that her offence was relatively minor in the pantheon of sins.

It may look small beer compared with her predecessor Fred Goodwin’s reckless arrogance. But any chief executive who breaches customer confidentiality has to go and could not be excused on the grounds of gender. The standard of conduct from the bosses of the UK’s top banks has been worryingly low, however, not just before and during the financial crisis but beyond.

The culture of impunity persists. Individuals seem to face insufficient consequences. Andy Hornby, the chief executive at HBOS when it had to be rescued, remains at large and is now boss of The Restaurant Group.

Antonio Horta-Osorio kept his job at Lloyds after being caught in a liaison in a hotel with a mistress. He went on to become chairman of Credit Suisse where he was removed for breaking Covid rules. These things matter, because banking is founded on trust. Expectations of behaviour and judgment are rightly very high.

Concern: The standard of conduct from the bosses of the UK’s top banks has been worryingly low

Many customers of Barclays, including me, have been troubled by the friendship between its former CEO Jes Staley and the late paedophile Jeffrey Epstein.

Staley has been embroiled in a legal case in the US over Epstein, a former private banking client at his previous employer, JP Morgan. Staley has denied involvement in Epstein’s crimes. Barclays’ board knew at the outset there were question marks over Staley’s relationship with Epstein.

The Barclays board appointed him despite the reputational risk, and stood by him in 2018 when he was fined more than £640,000 for trying to unmask a whistleblower. At the time, the City regulators found ‘his behaviour fell below the standard we require’ yet he kept his job for three years.

No wonder the board of NatWest thought they could keep Rose. Whilst Staley’s troubles have received relatively little coverage here, NatWest has been caught up in Britain’s continuing Brexit preoccupation.

Why, though, is the casualty rate among bosses of UK banks so high? One answer: these are difficult jobs, subject to relentless scrutiny, and bankers are only human.

Another is a failure to concentrate on banking basics: providing customers with the services they want and supporting businesses. A third is inadequate boards, stuffed with also-rans and self-serving grandees. They should spend less time trying to defend indefensible executive behaviour and wokery, and more time thinking about what customers really want.

The common thread in banking debacles is losing sight of the real purpose of a lender, which is customer service. One of the problems at Coutts appears to have been misunderstanding the nature of a private bank, whose point is to be exclusive and elitist.

Why were bosses trying to portray it as a half-baked activist organisation?

If I were a rich client, I would want to be greeted by flunkeys with gold frogging on their frock coats, served my statement on a silver platter and pelted with violet petals, not given a lecture on being woke.

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