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Last updated at 13:31 BST, Friday, 17 July 2009

Call for change in UK banking system


17 July 2009

A report sponsored by the British Treasury, has called for changes to the way banks are run, with boardrooms and shareholders being told to exert more control over excessive risk-taking and payment of large bonuses.

Robert Peston

Canary Wharf


Click to hear the report:


The worst banking and economic crisis since the 1930s was caused in large part by banks' recklessness, and this recklessness wasn't prevented by the non-executive directors of banks, or their shareholders. And what's more, the dangerous gambling was encouraged by the manner in which bank executives were paid.

A Treasury-sponsored report has today made recommendations to turn shareholders into more involved owners, who would be more likely to say "enough and no more" when banks are borrowing and lending too much.

Other proposals would see non-executives better trained, working more hours and more likely to challenge the executives. As for the bonuses of bankers, including those below board level, they'd be subject to more scrutiny, with those notorious bonuses only paid out after years have elapsed, once it's clear that their deals aren't toxic.

Robert Peston, BBC


Click to hear the vocabulary


in large part



doing something dangerous and not caring about the risks or possible (here, negative) results


people who own a proportion of a company, called shares which are worth more money when the company makes a profit

more involved owners

here, people who have more influence in how the banks are run


an extra amount of money that is given to people as a reward, in addition to what they are paid in their salary (in the banking world, bonuses have been known to be very large)

those below board level

the group of people who are under the level of the executives in a company's hierarchy

subject to more scrutiny

likely to be investigated further in order to obtain information about it


well-known or famous for something bad


gone past, usually used with a period of time


poisonous, bad or likely to bring trouble in the future

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