View all newsletters
Have the short, sharp Spear's newsletter delivered to your inbox each week
  1. Wealth
October 25, 2012

Hector Sants, ex-FSA, criticises City as dishonest

By Spear's

Ex-FSA CEO Hector Sants criticised the City as lying and deluded, saying his life would have been made much easier if ‘many of the individuals I was dealing with had just been more honest

‘It’s surely abundantly clear that banks need massively more capital,’ Sir John Vickers said today, in a debate on restoring trust in financial markets at Saïd Business School, University of Oxford. Sir John was joined on the panel by Hector Sants, former chief executive of the Financial Services Authority, Ana Botin, CEO of Spanish bank Santander’s U.K. businesses, and Robert Peston, the BBC’s business editor.
 
Sir John continued ‘It’s absolutely clear that macro-economic policy needs more instruments than just interest rates, including macro prudential tools’. He argued for structural reform within banking and added that he was ‘cautiously optimistic’ that the British banking system was on the recovery track from a ‘particularly bad crisis’ but it was ‘a long haul’, estimating that we are half way through the process of recovery. 
 
Mr Sants, recalling his career as the chief executive of the FSA from 2007 to 2012, said his life would have been made much easier if ‘many of the individuals I was dealing with had just been more honest’, not just in terms of truthfulness but in terms of less self-delusional. He also called for more enforcement of regulation and a stronger deterrent system, saying ‘the authorities need more power and tools’.
 
Mr Sants highlighted several issues that would restore trust in the banking system including a bigger distribution of profits to investors and a ‘much smaller take by bank employees.’ He called upon shareholders to act as owners and to be more active in challenging the banks.
 
Mr Sants said nothing less than a major culture change was required within the financial sector and within banks in order to encourage behaviour change. He said banks need to become ‘learning organisations, open to admitting their mistakes’. He also discussed accountability and the need for incentive structures to be tied to it. He called for greater integrity within the profession and for higher personal standards. To achieve this, he suggested, it might be necessary ‘to renew management teams’.
 
Speaking on how banks could restore their customers’ trust, Ms. Botin said in 30 years in the industry she had never been such a high level of public mistrust in banks. To address this she said ‘banks need to rediscover the philosophy of service and to put customers at the heart of their business’. She called upon banks to ‘be transparent, be fair and to create value for their customers’.
 
Robert Peston called for a fuller and more open national debate on banks and for regulators to eschew the technical language they usually employ to communicate more clearly and directly with the public. He commented on how tolerant the public has been of the financial crisis and the actions of the financial sector to date, and suggested that this might not be the case next time. All the panelists agreed there would be a next time.
 
The panelists were speaking before an audience of about 200 senior policy makers, critical thinkers and internationally renowned experts at a symposium on ‘Resetting the Business Agenda,’ at the Saïd Business School,. The symposium also explored some of the big challenges facing businesses including how we can responsibly harness the massive flow of big data and how to lead complex organisations in the 21st Century.
 
A recording of the panel session will be available here: www.sbs.ox.ac.uk/rtba

Don’t miss out on the best of Spear’s articles – sign up to the Spear’s weekly newsletter

Content from our partners
Stoneweg, Icona, and CBH Strengthen Partnership with Cromwell Acquisition, Adding €4 Billion AUM to Stoneweg
Why investors should consider investing in nature
HSBC Global Private Banking: Revisiting your wealth plan as uncertainty abounds

Select and enter your email address The short, sharp email newsletter from Spear’s
  • Business owner/co-owner
  • CEO
  • COO
  • CFO
  • CTO
  • Chairperson
  • Non-Exec Director
  • Other C-Suite
  • Managing Director
  • President/Partner
  • Senior Executive/SVP or Corporate VP or equivalent
  • Director or equivalent
  • Group or Senior Manager
  • Head of Department/Function
  • Manager
  • Non-manager
  • Retired
  • Other
Visit our privacy policy for more information about our services, how Progressive Media Investments may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
Thank you

Thanks for subscribing.

Websites in our network