Thursday, 20 June 2013


Quality time for Bankers?
I have no problem with most of the recommendations from the Parliamentary Commission on Banking Standards, which suggested that senior bankers who are guilty of reckless misconduct should be jailed. That’s fine with me, and probably lots of people, but what about the politicians who appear to have largely escaped censure beyond the prospect of being elevated to the House of Lords. Personally I would have been happier had the commission recommended that the politicians who were responsible for the crash in the first place could be held to account (as happened in Iceland) and subject to conviction, should also have faced the prospect of going to jail.

The weighty 571-page report has recommended that the government review alternatives for selling off the Royal Bank of Scotland (RBS), including breaking it up, and has demanded action to make the banking market more competitive. In relation to RBS, the committee only suggested that the Westminster government formally look at different options for the nationalised bank by September 2013. Some committee members recommended splitting RBS between a "good bank" (an active High Street lender with a cleaned-up balance sheet) and a "bad bank" (a warehouse for all of the dud loans left over from last decade's debt bubble).

Another option, which was backed by the Archbishop of Canterbury and committee member Justin Welby suggested breaking RBS up into a number of smaller regional banks. The committee cautioned against rushing to privatise the bank, which it said risked getting poor value for the taxpayer, and because the committee believed RBS first needed to be restructured, in order to make sure it played its key role in supporting the economy. This is the cross-party parliamentary group's fifth report laid into the lack of accountability of bankers and also recommended that some bankers bonuses be withheld for up to 10 years - something that would probably not upset many people, save for the bankers.

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