City's Lord Mayor demands halt to 'banker bashing'

Published on Saturday 7 March 2009 13:28

THE Lord Mayor of the City of London has demanded an end to public "banker bashing" which risks damaging the reputation of Britain's financial services industry around the world.

Ian Luder, who is on a four-day visit to Scotland, said it was vital to restore confidence in the City following months of gloomy news about the banking crisis.

He said the recent heavy criticism of the banking industry threatened to deter foreign investors from ploughing cash into the Square Mile and other financial centres such as Edinburgh and Manchester.

He did not name any individuals but his comments coincided with the outcry over former Royal Bank of Scotland boss Sir Fred Goodwin's pension. The City law firm Linklaters is to launch a probe into Goodwin's pension and the sports sponsorship deals he concluded.

During an address to members of Scottish Financial Enterprise, Luder argued that the turmoil is being shared by many nations.

"Right now people are furious, let down by bright people, bankers, regulators, non-executive directors whom they once trusted but are now labelled as greedy or asleep at the wheel. I understand the feelings of anger, bewilderment and betrayal but we do need to learn from the past and move on," he said.

"Banker bashing and running ourselves down is potentially harmful and it's not what people think overseas."

Speaking to Scotland on Sunday, Luder said: "Globally the sector's reputation has clearly taken a bash. We are terribly good in Britain at self deprecation – we would win the Oscar in it. We have been wallowing in that and it's quite damaging."

While the banking industry continues to face challenges, Luder argued that other financial sectors, in particular foreign exchange trading, are still going strong.

The Lord Mayor, who acts as a non-political champion for the UK financial services industry abroad, also warned against the danger of over-regulation as the City awaits the results of FSA chairman Lord Adair Turner's review into regulatory reform, which is due on March 18.

Luder said: "What we need to see is regulation concentrating on things that matter, setting sensible frameworks. Above all we need to have a global regulatory framework."

He suggested regulators also look at the role of non-executive directors following criticism that some boards failed to halt adverse risk-taking in the run up to the credit crisis. "Supervisory directors (non-executive directors] will need to have fewer appointments and devote more attention to each," Luder said.