BBC BLOGS - Peston's Picks
IN ASSOCIATION WITH
« Previous | Main | Next »

RBS and HBOS: Questions of competence, not corruption

Robert Peston | 15:30 UK time, Tuesday, 18 May 2010

Johnny Cameron, the cove who ran Royal Bank of Scotland's investment banking division at the time the bank went to the very brink of collapse, has agreed with the City watchdog that he won't ever again work full time in a senior position in the financial services industry.

RBS logoHmmm.

You might find that story about as surprising as "starving, rabid dog in hot climate bites sweaty fat man".

Or to put it another way, after Royal Bank was bailed out to the tune of around £50bn by taxpayers, it would be slightly odd if any of those in senior executive or non-executive positions at RBS back then were deemed suitable stewards of financial businesses.

In fact what some may wonder is why - some 18 months after the meltdown at RBS - Mr Cameron is so far the only former director of that bank to be the object of a formal restriction on where and how he can work.

It's also worth noting that Cameron jumped before he was pushed: he agreed to be disbarred (so to speak). But he retains the right to act as a part-time advisor to City firms (which, since his very public humiliation, is all he wanted to do, in any case).

Here's perhaps the most significant part of the FSA's statement about Mr Cameron:

"The FSA has not made any findings of regulatory breach against Cameron and he has not made any admissions".

Or to put it another way, the FSA questions his competence to run a bank, but doesn't think he broke any of its rules.

What that implies is that it's quite possible to be on the bridge of one the world's great banks, which is part of the UK's economic infrastructure, as it ploughs into a humungous iceberg, while following the FSA's rulebook and the law.

Some, I suppose, may wonder whether the rules and the law are quite what they should be.

What also follows?

Well, the FSA continues to investigate the events leading to the disasters at RBS and at HBOS.

In RBS's case, the focus is on its reckless acquisition of the poisonous rump of the Dutch bank ABN Amro, which made RBS too dependent on unreliable short-term funding in the wholesale money markets and also imported several tankers of loss-making loans and investments on to its overstretched balance sheet.

At HBOS, the FSA is looking at how the bank lent so many tens of billions of pounds to companies - especially property ones - that were acutely vulnerable to any economic slowdown.

Both probes have been going on for well over a year. So it's reasonable to conclude that if the FSA had found evidence of fraud or serious malpractice, we would have known by now - such is the propensity of these things to leak.

What that means is that if the FSA finds that the banks and their directors did anything untoward, the verdicts are likely to be about their competence and diligence, not their probity.

Which some might see as something of a great escape for bankers who many would hold responsible for the biggest raid on taxpayers' wealth in British history.

Comments

  • Comment number 1.

    He should count himself lucky that this is not China...as this is what they do to errant business men in China...

    'China’s richest man, jailed for 14 years'
    http://blogs.ft.com/beyond-brics/2010/05/18/in-china-contacts-are-everything/

  • Comment number 2.

    Which just goes to show that the FSA didn't even have the tools to regulate the banks in the runup to the financial crisis, let alone the will and competence to use them.

  • Comment number 3.

    There are no laws against greed and unfortunately there are no laws against the cosy employment of pals from the better education establishments old boy. Of course, if you step out of line and admit to failure you have to be disciplined Jonny. Should have kept shtum you twit.

  • Comment number 4.

    Look when the rules are written by numpties for numpties...

    I was really chuffed to read about the demonstrations in Washington DC though (Huffington Post). Since our politicians the world over don't do what they need to do to keep us, their bosses safe from predators, robbers, idiots, etc, then the people who were/are hurt by these fools, these rich fools, have tracked them down and are demonstrating outside their homes!

    Sweet. Really sweet. Seems it is one of the richest areas of DC, so that'll probably be snotty Potomac just up the road from Bethesda. First the cherry blossom gazers arrive to disturb surbubia while they gaze at flowers for hours on end every spring and now the demonstrators!

    Just spreading the Joy to all the residents. With loudhailers.

  • Comment number 5.

    Robert, you have mentioned a few times the way in which bankers attempt to justify their remuneration on the basis that they need to recruit and retain the best people.
    The FSA identifying that some of those top flight (top paid) people are not actually that good puts rather a hole in that argument, doesn't it?
    Or is it that the banks are too large and complicated for even the very best people to manage competently?

  • Comment number 6.

    London bankers’ net earnings continue to outstrip those in Zurich or Geneva, says a study. The difference in salaries means the monthly pay check is, for the most part, still higher in London, even after a new 50 percent tax left by the outgoing Labour administration. The survey’s findings discredit the notion of a mass exodus of financiers from the City to escape the new tax.

    Quoted from Swisster. Now boys, what was that you were threatening to do? That's right leave! These taxes need to be bumped up quite a bit yet, don't they.

    Well, part time work wouldn't let any of us keep a roof over our heads, so the same should apply to you lot!

  • Comment number 7.

    For every feckless borrower, there is a feckless lender.

  • Comment number 8.

    You didn't mention how much he made while fiddling with the numbers. My guess is that he will not be homeless, as others have become because of his actions. A small head to roll in the scheme of things and the rest are still in control and extorting money wherever possible from nations suffering from fiscal stress created by the banks. The impotence of governments and their layers of corruption made this all possible and the people stood passively by while the banks stold their money and the governments added insult to injury by creating future taxes to repay the bankers for their unethical and damaging collusions. Welcome to the corporate state as that who makes the decisions and the governments are nothing but tools to be used as cover and approval for their criminal activities. Errand boys for the banking mafia.

  • Comment number 9.

    > What that means is that if the FSA finds that the banks and
    > their directors did anything untoward, the verdicts are likely
    > to be about their competence and diligence, not their probity.

    Power-crazed nutcases don't have much "probity" to start with, so
    you're on a hiding to nothing with that.

    Look, bankers are sheep-like creatures; one follows the other.
    Sometimes, it's hard to detect character defects, but we can
    spot these guys miles away. They spend their time smoozing
    in "The City" and making large like a bunch of gangsters.
    Downtown London is squirming with them, believe me.

    The only answer is Tough Love - take away their lollipops,
    and make them get proper jobs.


  • Comment number 10.

    "Some, I suppose, may wonder whether the rules and the law are quite what they should be."

    Quite.

    "Which some might see as" .... the bank robbers getting clean away.

  • Comment number 11.

    What it means Robert, is that the FSA either doesn't know where to find the evidence, or after all this time, the evidence has been conveniently 'cleansed' from the system! Barclays (amongst many others may have modified their computing systems six times in as many years)

    Time and again in your columns you highlight RBS, HBOS, Northern Rock, Lloyds, UBS and many other foreign banks.

    I have yet to see an in-depth critique of Barclays and the unsavoury actions of not just Barclays Capital, but Goldman and Blackstone and the many other US investment outfits trading here and in Wall St.

    Barclays fought for ABN-Amro just as fiercely as RBS, but Barclays were after cash only - so were Barclays 'busted' even back then?

    If so, why didn't the regulators hear about it, or was it one of these silent back door deals, done at the time, with the Bank of England, so as not to 'upset' the market place?

    Many banks, retail or investment, have been involved with investments and funding directly or indirectly in all sorts of regimes, good, bad and ugly - both nauseating and those smelling of roses, from militia groups, to corrupt governments, to struggling democracies - its the way of the world unfortunately.

    We have a right to know more about every bank and its part played in the 'Big CC'.

    The culprits were not just HBOS, RBS and Northern Rock - they were the ones caught with their proverbial 'trousers down'!

    Unless we do, I suspect the Cayman Islands will be all the richer for many years to come, off the back of the likes of Joe Public, UK PLC!

  • Comment number 12.

    No one formerly at the top of these failed institutions needs to work again as the incompetent oversight in these organisations rewarded many very well for failure.

    Sadly, most boards of UK PLCs are either too craven or linked by cross directorships to vote against such greed.

    This is the reason why people are paid so well in the UK and US pure greed with little oversight. Let us not pretend these CEOs are special most are simply good politicians or in the right place at the right time.

  • Comment number 13.

    Yet you still defend the generous remuneration of these bankers (rhyming slang). When it is clear that a chimp with a pin would have done at least as well, and probably much better.

  • Comment number 14.

    # 6. At 3:57pm on 18 May 2010, copperDolomite wrote:

    > These taxes need to be bumped up quite a bit yet, don't they.

    We're supposed to be putting up the taxes to get rid
    of this scourge, yet they are clinging on. There's a
    shortage of all manner of labour (I can't get a
    bloke to fix my garage roof, for example), but I
    am NOT short of bankers, thanks!

    PS: unless they can fix roofs....

  • Comment number 15.

    So the final conclusion is that this man was so grossly incompetent that, along with similar colleagues, he managed to loose £billions. If I robbed an old lady of her purse I'd be asked to repay my debt to society. Is this man yet offering to work the rest of his life to pay back to the UK taxpayers even a small contribution to what we have all contributed to rectify his staggering level of incompetence?

    And is our new government going to exact any legislation not to drown the financial sector in needless new bureaucracy (after all the millions spent on Basel2 by each bank failed to work) but to punish those guilty of massive theft from UK taxpayers at RBS, HBOS, BBBS and Northern Rock?

  • Comment number 16.

    Banker told can't work again because he was useless retires to one of his seven holiday homes in Cayman Islands in disgrace.

    Engineer told can't work again because of the global crash and UK lack of coherent industrial strategy kills himself leaving wife and three children penniless.

    They are laughing at us!

  • Comment number 17.

    Now, doesn't Stagnation plus Inflation equal Stagflation ?

    Freezing or cutting Salaries, not to mention Jobs, means much lower Consumer spending (the Investment Bankers can't spend enough to make up for the ordnary peoples losses!).

    Lower Consumer Spending will mean lower profits, which will mean fewer Jobs, and so on.

    This downwards spiral only benefits the very rich.

    The ordnary people will end up living in a pseudo Victorian Age wherein having a Job at all will be seen as a luxury !!!!!

    The Americanisation of Britain is planned.
    Fewer Welfare provisions, more Private provision (if at all).
    And some one was saying they expected the Voluntary sector (who are they?) to step up, and cover the gaps left by sacked Employees !

    So, how do these Volunteers live ? Where do they get their living from ?

    Many Volunteers are currently Pensioners. As few people are going to have decent Pensions (City Incompetence again) in future, there will be even fewer Volunteers.

    Of course, Community Service, could now involve supporting the Elderly, Cleaning Hospitals, serving in Afghanistan, Driving Ambulances, Patrolling the Beat, etc.
    No, of course not, volunteers ? Community Service ? Daft ideas.




  • Comment number 18.

    Jonny Cameron is so comfortably off he probably needn't work again. Not the case for many others lower down the food chain who lost their jobs.

  • Comment number 19.

    15. At 5:07pm on 18 May 2010, geoff hughes

    Nope! Apparently there are a few evangelical Christians now sitting in parliament, so they'll no decide we should all just pray instead of using our brains to figure out what they should be doing but aaren't.

    The banks have got to go. We're already like the peasants living on the land for as long as the guy in the castle gives us permission to work our socks off just for crumbs while handing over almost everything we grow or produce to him! Medieval lifestyles, that what it is.

  • Comment number 20.

    Yes, this is pretty feeble. To (mis)quote Mark Twain:

    Suppose you were a member of the FSA.
    Now suppose you were an idiot.

    But I repeat myself ....

  • Comment number 21.

    Re: 17: supercalmdown

    Exactly - another cracking idea, Grommit, is National (Civil) Service for the young (unemployed). Crikey, I can imagine the queues stretching round the block as young people say 'honest, I am sixteen really' in order to qualify. More likely they'll have to be rounded up and confronted with a choice of 'service' or no money - that will really enhance society and engender a sense of worth amongst the (already-devalued) young.

  • Comment number 22.

    Robert:

    'At HBOS, the FSA is looking at how the bank lent so many tens of billions of pounds to companies - especially property ones - that were acutely vulnerable to any economic slowdown.'

    Check the senior execs Bank accounts..... and then look how many have been fined or sent to prison.

    That's your answer..... ultimately there is no real resposibility, no downside to the huge upside these guys have!!!

    'I was a little silly' gets you off... and you can also keep the millions you've been paid

  • Comment number 23.

    Interesting....

    Why did he go so quietly?

    Why no court case? No appeal? No defence that he was only acting under orders? Why has he allowed his bosses to be let off?

    Does any one really think that he is going to go quietly into retirement?

    Perhaps a pay-off to take the blame?
    Perhaps a lucrative book-deal to pay the mortgage?
    Perhaps a mansion in the sun as long as he stays quiet?
    What about the film rights?

    When it smells like a rat....it probably is!

  • Comment number 24.

    And so we will all pay more tax for years to come for this , not failure more greed and self delusion.
    It proves the banks could not run a business in the real world, such as a market stall.
    All they seem to know is theory .. And they are mostly all still at work in the banks taking bonuses from use all.
    And will the new politicians do anything? After all what do the new lot know?
    It is all so worrying

  • Comment number 25.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 26.

    17. At 5:43pm on 18 May 2010, supercalmdown

    It really makes me laugh.

    What nice landlord volunteers accomodation to the volunteers?
    What shop volunteers food to the volunteer army?
    And what shop donates their clothes, etc? Obviously the utilities will donated too!

    And no one was paying attention; the charities got thumped when they lost their money on the markets, to how many of them have actually got the infrastructure? Well, it doesn't matter does it, because someone somewhere will donate that infrastructure...

    Makes me weep.

  • Comment number 27.

    And here's an unrelated story:

    Toddlers who tell lies early on are more likely to do well later, researchers claim.

    This was because they had developed the ability to carry out a complex juggling act which involves keeping the truth at the back of their brains.

    He added: "They even make bankers in later life."
    ___________________________

    I love this guy .....


  • Comment number 28.

    "What that means is that if the FSA finds that the banks and their directors did anything untoward, the verdicts are likely to be about their competence and diligence, not their probity."
    Has anyone seriously suggested that the banks' executives were (mostly) criminal ? Surely the problem is that they were (almost) uniformly incompetent. The structure of their pay and bonuses did not allow time to test this possibility.
    The scandal is of course that their losses were not borne by their shareholders.

  • Comment number 29.

    Probity? Isn't that what Lord Archer had in spades?

  • Comment number 30.

    Your last line sums it all up, as usual, Robert.

  • Comment number 31.

    Of course if you want evidence of actual corruption we should look no further than the 'Land of The Free'where the IRS and Justice Department has uncovered a huge conspiracy to rig the auction of Municipal Guaranteed Investment Contracts. Now, you may not know what GIC's are (kind of municipal bonds for short term financing but with the kicker that the banks offer 'blind bids' regarding the interest rate they are prepared to pay) but the fact that the feds are investigating over 200 deals done with over 160 different local authorities across the country should tell you that this is a serious matter. Seems like the financial 'advisers' used by the municipalities were letting on to favoured banks what the competing bids were so they could undercut them..for a fee of course.
    The more you look into the world of finance the more it appears that the only ambition of most institutions is to wipe out their competitors and get an 'edge' using any means possible, legally or otherwise. The obscene remuneration is not necessarily a symbol of greed,however. I remember reading about Michael Milken in the 80's pulling down over 100 million dollars a year trading junk bonds at Drexel Burnham Lambert but he never spent any of it, he didn't have time, working 18 hour days but it was how you 'kept score'...

  • Comment number 32.

    Of course these bankers were just doing what bankers do.
    It is a bit like the Queen thinking that all factories are clean and smell of fresh paint.

    You wouldn't expect the Queen to roll her sleeves up and get on with some real work.
    Same with the bankers.

    It would come as a shock and surprise to them what some people have to do to earn a living. Day in day out.
    Cleverly they have adapted their part of the system to suit themselves.
    And we get to place an X once every 5 years if we are lucky.

  • Comment number 33.

    If not competence, then what does one need to get a top-paid job in the city?

    How about the competence of those who either allowed or gave him the job?

  • Comment number 34.

    # 26. At 7:09pm on 18 May 2010, copperDolomite wrote:

    > Makes me weep.

    Don't worry, copperDolomite. We MUST squish the bankers, because they are causing communism. The commies love the bankers, because they make thier work so easy.

    So, we need to flush these chumps, to regain a balance. Without it,
    it'll swing too far the other way, as sure as eggs. Bankers either have to hang up thier boots, or hang from a noose. Some choice, eh?

  • Comment number 35.

    WE ARE TRULY BEING SOFT SOAPED AND SHAFTED...

    ...With a backdrop of bankers looting the EU’s Treasuries (via a bailout that rivals George Bush’s TARP) let us consider one of the most significant Dem-Con appointments (and a non-appointment) to the British cabinet.

    That of someone who until now was invisible: David Laws the new Chief Secretary to the Treasury.

    His Wikipedia profile (updated on the day of his elevation, and before he had taken up his ministerial responsibilities) depicts him as the man that speaks for his party on matters relating to kiddie-winkies and families and, no doubt, motherhood and apple pie. He is also commended for his conciliatory role in negotiating the Scottish Parliament coalition.

    No mention here of his real background.

    For, according to ePolitix, David Laws was once Vice President of JP Morgan and Co and based in the United States, before becoming Managing Director of Barclays de Zoete Wedd in 1992.

    Now, in my book the most obvious candidate for the job of Chancellor, or Chief Secretary to the Treasury, was surely Vince Cable, a man credited for his prescience in predicting the financial crisis, respected for his ongoing analysis of that crisis and regarded as a “scourge of City ‘fat cats’.”

    Why was he shunted across to the toothless Department of Business, Innovation and Skills? And why was a man who until now has had absolutely no record of speaking out on the financial crisis, elevated to a powerful post at the Treasury?

    Could it be that Vince Cable is unacceptable to the City? That he was likely to threaten the oligarchical role of the British banking community, and their grip on the UK Treasury?

    We really need to to wise up and rise up...and soon!

  • Comment number 36.

    The biggest story of the day ... will not even make it to any page of most newspapers.
    Another 'vested interest' case ... 'swept under the carpet'.

  • Comment number 37.

    31. At 8:33pm on 18 May 2010, mischievousCheesy101

    Wow!

    Wasn't there some discussion during the election campaign that all this decentralistion would include allowing our local councils to sell bonds?

    One more rip-off and all we'll have to pay the debts is the tarmac - that'll be what the young volunteers are for, is it? Get them trained early!

  • Comment number 38.


    34. At 9:12pm on 18 May 2010, Jacques Cartier wrote:
    # 26. At 7:09pm on 18 May 2010, copperDolomite wrote:

    > Makes me weep.

    Don't worry, copperDolomite. We MUST squish the bankers, because they are causing communism. The commies love the bankers, because they make thier work so easy.


    You know, when I wrote that last comment I really was thinking maybe if only all of us had voted Communist! Voting for the green party just isn't making the point loud enough!

    Nearly 50 million Americans have no heath insurance! That's about 1 in 6 people. Cappitalism is the greatest risk to health that isnt made of protein, lipid acids and nucleic acids!

    I've been listening to a podcast of Krugman again (he's noticed the economies with decent unions haven't got into such a mess/state of being ripped off)and another with Juan Gonzalez talking to Steven Greenhouse about the data showing that as long as we have no socialism, these Capitalists don't have to be decent! So let's go for it, scare them senseless and bring back the Communists. I suppose!


  • Comment number 39.

    35. At 9:23pm on 18 May 2010, DebtJuggler

    I'm not surprised in the least, are you?

    Whatever the Americans do, we copy.

  • Comment number 40.

    Bobby, I know you have to watch what you say on TV, balanced, anaemic, etc. so why dont you get Max Keiser on as an interview. He has been banging on about the bankruptcy and corruption of the financial system for a good few years now, and is kept off the mainstream media as much as they can. Your viewers deserve to hear his side of the story -and Steve Keen from Australia.

    You must know these people.

  • Comment number 41.

    Is it corruption if what was considered corruption was legalised through bribery?

  • Comment number 42.

    Is it even theoretically possible to function in modern society without having to deal with banks? I'd love to do that (positive action), but I can't see how it's even remotely feasible.

    That's the real problem. Never mind lack of competition, there's not even a viable opt out, unless you're willing to be a complete social outcast. And so we ALL end up encouraging them to carry on as before!

  • Comment number 43.

    42. At 11:45pm on 18 May 2010, Beatsy

    You could use the co-op, a local credit union or just a building society (I think there are some that stayed as proper building societies) or the post office.

    Credit unions are becoming more popular here in the UK, and have been well-established in the US for years.

    I think you are legally entitled to insist your employer pays your salary in cash here in the UK.

    If all of that is just too much hassle and doesn't fit in with your daily schedule, you could just lift every penny out of the bank the day your boss pays you.

  • Comment number 44.

    Why are we still considering the fact that greedy incompetent bankers supported by greedy incompetent non execs of another bank were not fit and proper persons to run a bank for the good of its shareholders and its customers. We knew they were incompetent before all this really happened, when a senior officer of any public company or institution uses the excuse of "we have to pay XXX to attract the best" you know that its a stitch up. If we have to pay xxx that means our own salary package and bonuses must go up by X+2 or 3 or 4. As these scheming greedy individuals have no moral judgement, perhaps a financial ASBO would be in order along the lines of "You were in charge and contributed to the crisis but still insisted on bonuses not earned, therfore for the next X years you will work for and contribute to the taxpayer a sum plus interest commensurate with your percentage part of the losses incurred by your actions" In addition any earnings over £100K will be taxed at 75%, and just to make sure you understand the contractual terms, you will work until the debt to this country and society as a whole is paid off, or you can sell your house, car, overseas investments towards part of the debt. No appeal, no human rights nonsense, no whining about it being unfair, and no future dodgy deals with your chummy friends.

  • Comment number 45.

    I thought that if a director was proved to be incompetent he can be struck off a bit like a doctor. Companies House barred them from holding directorships to prevent them operating a business again?
    Or are bank directors exempt from these rules that ordinary directorship mortals have to live by?
    When a private company goes bust bust the directors are dragged before the courts to explain why the business folded and sort out who gets paid first in the list of creditors.

  • Comment number 46.

    Comment 42 yes it is possible to chop banks out of transactions.
    We could all start using cash again, demand that your pay be paid in cash.
    Cut up the debit cards, credit cards and stop having loans other than your mortgage and buy your insurance direct.
    That would mess things up for the banks surely, probably safer to put your cash under the mattress than leave it in a cheque account!

  • Comment number 47.

    Become a Muslim, its written into there laws that to charge interest is immoral and against there faith. Western Banks hate Muslim banks because they are not driven by profit its a completely different culture in Asia.
    As the Prudential will find out !

  • Comment number 48.

    45. At 01:02am on 19 May 2010, KeithRodgers

    Barring a director! I've known people with piles of evidence and try to have that happen - it seems you're more likely to catch a pickpocket and have him sent down for years than succeed with barring a director.

  • Comment number 49.

    How come I can sit in front of a computer, surf the net + e-mail etc. and doing all sorts of things, but still, I can't make any money...There again I do not produce anything, so I suppose that I don't expect to make any money...unlike a farmer or a fisherman for example who produces food.
    Now similarly these city slickers are also sitting in front of computers, surfing the net + e-mails etc. and doing all sorts of things...But the difference is that they seem to be making loads of money...and they too seem to be producing nothing...
    I am also very good at Maths + Arithmetic + Languages + Science + History + Computing etc etc...just like the kids coming out of school and university...
    So where am I going wrong.??

  • Comment number 50.

    47. At 01:10am on 19 May 2010, KeithRodgers wrote:
    Become a Muslim, its written into there laws that to charge interest is immoral and against there faith. Western Banks hate Muslim banks because they are not driven by profit its a completely different culture in Asia.
    As the Prudential will find out !

    -----------------------------------------------------------------------------------

    What a stupid comment! Very clearly shows you to be an idiot - one that has never travelled.

    And btw, Christianity forbids usury too.

  • Comment number 51.

    #5 hits the nail on the head.

    Talent my *ss. I have enough personal experience of the work of so-called "top" executives (in al market sectors) to see them for the bunch of incompetents that they really are.

    Much of what happens in a company i dictated by customer-driven market forces, not supposedly brilliant leadership - for example mobile phones, how could you fail given the popularity of those devices? All mobile phone companies are massively successful when compared to their start-up positions. And comparing their success to each other is an exercise in futility.

    I do believe that it is time to limit the remuneration of all employees of a company, with the possible exception of privately owned companies or perhaps better still, where the vote of the shareholders is unanimous.

    Then of course, you have to deal with the creation of "holding" companies to wholly own the plc. Corporate law and permissible structures needs a very big shake-up.

  • Comment number 52.

    Incompetence comes about because people are struggling to do the job due to lack of skills etc.These people are not dumb so I conclude that this was a deliberate attempt to destabilize a market and probably bring about a change of government.The systematic robbery of every bodies assets e.g. - property devaluation, pension devaluation, share devaluation etc was brought about to also help city stock brokers make money in a market that was stagnant.
    Examples, nobody was buying houses, so force prices to drop, everybody panics and sells, the finance industry then goes in for the kill. Estate agents get more business, mortgage business goes up etc.

  • Comment number 53.

    The size of the error,the mistake, call it what you will is so tremendous that it is hard to believe that anyone questions the competence of bankers . No they are not competent. Are they corrupt? How corrupt would you have to be to hide "errors" of this size? Is it possible to have errors of this size and not be corrupt? Where are all the nest eggs hidden? Sorry these are called bonuses.It beggars belief that anyone wants to employ them , or, why they have been allowed to contact any bank. Why are these people not in jail? Can we send them to a "correction" centre in China?

  • Comment number 54.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 55.

    I still think the banking system is pulling the plug on all western markets. The plan is to dump the mature customers of the west now they are on to all our tricks. Transfer all the capital to the east and start off again with a fresh batch of naive consumers.
    They all want to aspire to the western life style so we sell them endowment mortgages, pensions, useless insurances etc.Then all of this cash doing a disappearing act would make sense.Basically we have all got wise to there scams and they are finding it hard to sell any financial product. It fair to say they have brought that situation on themselves.

  • Comment number 56.

    With the salaries of all the top management well out of line with their competence these are companies that can be made very profitable very quickly. HBoS in LBG is benefitting from LBG being a bit better than htey were. This said in IT LBG was a basket case while neither bank can manage or deploy any effective International presence.

    Ultimately HBoS and LBG will have to split due to market dominance issues. The question then is will there be anything worth splitting as bank branches vanish and people move to net banking in the same way they now do internet shopping.

 

BBC iD

Sign in

BBC navigation

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.