Banks need to return to basics to rebuild trust
Thu, 24 Sep 2009 10:34
Banks must return to basics in order to regain the public’s trust, according to the chairman of the Financial Services Authority.
At a speech in London yesterday (23 September), Lord Adair Turner says the financial services industry needs to “recommit to a focus on their essential social and economic functions, if they are to regain public trust”.
Lord Tuner adds that banks should concentrate their efforts on savings, credit and payment products for customers rather than the “over-complex products of no real use to humanity”.
The speech comes just over a year after the collapse of Lehman Brothers in the US kick-started the financial crisis that led to the near collapse of HBOS, before Lloyds stepped in, and Royal Bank of Scotland becoming 70% owned by the taxpayer after revealing billions in losses.
Lord Turner says one year on, the sector needs “to rebuild public understanding that banks and financial markets perform not only socially useful but vital functions”, adding “an industry that recognises the need to moderate excesses, rebuild trust and embrace reforms to prevent another crisis will prosper”.