Culture change is underway in banking sector

Culture change is underway in banking sector



798_2022-05-03-11-01-31am.gif
A think tank report this week has recognised that all banks have some kind of culture change process underway .

A think tank report this week has recognised that all banks have some kind of culture change process underway.

New City Agenda, in collaboration with CASS Business School, undertook a series of interviews with representatives from retail banks and other key stakeholders to provide an analysis of the culture of retail banking and the improvements since the financial crisis.

Its author, Andre Spicer, told the House of Commons that lenders now have a greater focus on transparency and authenticity and are more concerned about customer outcomes than sales targets.

The report also made a number of recommendations for banks, regulators, policymakers and the Banking Standards Review Council.

They are calling for accountability in driving cultural change whilst ensuring that these initiatives consistently reach frontline staff.

However, it realises that banks need time to change and suggests that a ‘complete transformation in the culture will take a generation.’

Another report carried out by the Social Market Foundation calls to level the playing field for different business models to increase diversity including in support of mutuals.

Paul Chisnall the Executive Director, Financial Policy and Operations, at BBA says he will have to agree to disagree on the reports call to reduce the £85,000 deposit guarantee limit back to its pre-financial crisis limit of £30,000.

“This stands against the provision of a high level of consumer protection for deposits and goes against the post-Northern Rock view that depositors should not be placed in the position of having to make decisions about where to place their deposits based upon whether one institution is safer than another,” he said.

“Such an approach would arguably also work against the opening up of competition.

“There have been many initiatives since the financial crisis to enhance the financial stability and to level the playing field between deposit-takers, old and new, big and small, PLC and non-PLC.

“These include raising capital and liquidity levels, reducing leverage, strengthening resolution, introducing macroprudential oversight and the shake-up of our regulatory authorities.

“Reducing the deposit guarantee limit has no part to play in this.”

Leave a comment