Page 6 - The Banks Article

How the banks and financial institutions reacted can, to

some extent, be measured in terms of their ‘conduct costs’
i.e. the level of fines, any sum that has become payable as a

result of, or in connection with, any breach of any code of

conduct or any sum paid in connection with any litigation

and so on which reflect the bank’s culture.

The world's top 20 banks, according to the Conduct Cost

Project's (CCP) Research Foundation, paid conduct charges

totaling £264 billion between 2012 and 2016, an increase of
nearly a third compared to the 2008-2012 period (2).

“we find ourselves wondering when, if ever, the level of conduct

costs will start to decrease. The new table tells us this has not

happened yet, at least when the five-year period ending 2016 is
compared with the preceding five-year period.

There has, in fact, been a 5.2% increase.” Roger McCormick (2).

“Findings from the latest 5-year period (2012-2016), including

provisions at the end of the period, reveal a total amount of
cGBP 264Bn. This represents an increase of c32.0% when

compared with the 1st research period (2008-2012). These

results highlight that, even 10 years after the start of the global

financial crisis, the financial consequences of misconduct
remain evident and material.”

This raises doubts about efforts by the major financial
services senior management, who after all set the culture of

their banks, to restore trust in the sector. Particularly, as it

points to sales driven cultures where scandal after scandal

has been revealed with the continuing refusal of the banks
to hold anyone in a senior position to account.