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Bank chiefs 'still don't get it'

Business Secretary Vince Cable has launched another attack on the banking industry, claiming senior industry figures "still don't get it".

The Lib Dem cabinet minister said it was becoming "increasingly clear" that the management of Britain's banks "want to choose the high risk, high reward" path when it was "vital" for the public they did not.

It comes as pressure continues to mount on Barclays chief executive Bob Diamond to quit in the wake of the lending rate scandal at his bank.

Mr Cable has backed calls for a criminal investigation into bankers involved in manipulating the Libor system.

Addressing the Association of British Insurers, he said the revelations strike many "as bordering on the criminal".

He said: "We have done everything we can to get ahead of the curve and deal with macroeconomic risks. But we can't do this alone, and it is increasingly clear that the management of many banks still don't get it.

"They want to choose the high-risk, high-reward path - seeking high returns on shareholder equity - when it is vital for everyone else that they don't.

"And now we are learning that this daredevil behaviour included taking blatant risks, once again to the detriment of the shareholder."

Urging shareholders to demand safer behaviour from banks, he called for banking to become "boring" again.

Mr Cable said: "When investing in bank shares is only for the brave, something has gone dreadfully wrong."


From Belfast Telegraph