Have Britain's Banks Come Good?

THE WEEK: In the past, banks had little concern for customers or shareholders as long as they were making money, but things are beginning to change

Rodney Hobson 1 November, 2013 | 10:16AM
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If you say something often enough it will surely be true one day. I have thought that banking had finally turned the corner on so many occasions that I hardly dares to say it, but… I think banking may have finally turned the corner.

As Nick Leeson exposed when he drove Barings to bankruptcy, the people in charge of banks had little concern for, or knowledge of, what was going on lower down as long as the activities were making lots of money. That was compounded by the proliferation of compliance departments that have, perversely, conspired to produce practices ranging from bad form to downright fraud.

Each time it looked as if the banks had finally come clean, another misdemeanour has crawled out from under the counter and the banks continue to pay back what they wrongly took. There is now genuine hope that the process is coming to an end, although it is by no means over, with the possible manipulation of foreign exchange rates emerging this week.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Barclays PLC178.58 GBX1.26Rating
GETECH Group PLC21.00 GBX-2.78
Lloyds Banking Group PLC47.31 GBX0.97Rating
NatWest Group PLC209.64 GBX1.08Rating

About Author

Rodney Hobson

Rodney Hobson  is a columnist for Morningstar.co.uk and author of several investing books, including The Dividend Investor and How to Build a Share Portfolio.

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