The new chief executive of the British Bankers Association (BBA), Anthony Browne, has pledged to restore trust in the banking sector and make it become a normal part of the economy, contributing to economic growth.
Mr Browne said: "I want to restore banking as a normal sector of the economy playing its part in economic growth. It is in a pretty low place. Hopefully it can't get lower."
Consumer group Which? has written a letter to Mr Browne, calling on him to work to restore trust and consumer confidence in the banking sector.
Which? says that banks have “lost their moral compass” and must “fundamentally change” in order to restore the trust of customers in them again.
The letter, written by Which?’s chief executive Peter Vicary-Smith, says trust in banks is at the lowest level ever recorded, with over 70 per cent of consumers believing that banks have failed to learn the lessons from the financial crisis of 2008.
Which? is urging the BBA’s incumbent to try and restore the reputation of UK banks that have been rocked by PPI mis-selling, IT meltdown’s and the manipulation of the Libor inter-bank rate.
The BBA was in charge of administering the Libor process and putting together the data that set the interbank rate. Mr Browne said that he will do everything he can to make sure the Libor rate works properly.
Mr Browne said: "We will do whatever is necessary to make sure it works as a credible indicator in the future."
All of these deficient areas come after the risky investment and lending strategies that helped cause the credit crunch that has led to the bleak financial landscape that the global economy has had to operate out of since late 2007.
And customers who have bailed out certain banks have had to sit and watch as “bankers continue to be rewarded with excessive bonus payments”.
Which? has called on the BBA to take five key decisions that can help consumers. It is calling on banks to put customers first, drive up standards and be more accountable for bad practice, establish the BBA as a credible voice, demonstrate leadership and speed up the pace of banking reforms.
Which? says the BBA must acknowledge the scale of reform required and not try to defend the indefensible and also be pro-active in pushing for banks to implement reform rather than wait for prompts from the regulators.
Mr Vicary-Smith wrote: “These changes cannot be made without leadership from the top which is why your position to influence the most senior bankers in the country is so pivotal.
“I hope you will lead by example, working with the banks to take real action to reform their practices, rather than defend the status quo or wait for Government or regulators to impose change upon them.”
Mr Browne, who was previously an economics advisor to Boris Johnson and worked for investment bank Morgan Stanley as head of government relations, said when he was appointed to the position in June that, “The BBA will continue to work closely with all interested parties for the benefit of customers, shareholders and members alike."
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