Once in a blue moon a banker does something so out of character it makes you wonder if someone squished his Bentley…just to show him who’s boss. So it is with Mr Crosby of HBOS, who a few days ago I would have called ‘Sir’ James.
But Mr Crosby has done the honourable thing and given up his knighthood for services to banking (and 30 per cent of his pension) when a report by MPs found that he and two other HBOS executives led the bank to ruin and eventual rescue by the British taxpayer. The 88-page report (thankfully a PDF) was entitled “An Accident Waiting to Happen: The Failure of HBOS”. Kinda says it all, really. The conclusion, (“A Manual for Bad Banking”) says of the bank’s board: “they were incapable of even understanding the risks that some elements of the business were running, let alone managing them.”
Perhaps Mr Crosby has a better memory than his colleagues, recalling the Royal Bank of Scotland chief Fred Goodwin, who last year was brutally stripped of his knighthood for messing up and is now (alongside his old bank) being sued by shareholders.
I’d rather like to see whoever decided who to give out these “services to banking” knighthoods stripped of their titles.
Anyway, banker bashing is an enjoyable, fairly guiltless endeavour, so I shall continue by pointing out that British banking has not had a good year:
Done and dusted, you think? I wouldn’t hold my breath. Bankers’ bonuses is a whole big issue I won’t go into now, other than pointing out that the EU is proposing to cap them at two times fixed salary. Critics say that this will just raise fixed salaries rather than lower bonuses. The UK is resisting, on the grounds that capping bonuses will threaten London’s massive financial services industry.
Bottom line: prosecute the individuals. Fining banks doesn’t work.
This post was a bit dense in subject matter. I recommend you watch a Russian gamer’s mesmerising completion of Nokia’s ‘Snake’. If only bankers spent more time doing this…