Government to get tough on Scotland’s bankers

Holyrood has warned bankers over qualifications for top bank jobs. Picture: Phil Wilkinson
Holyrood has warned bankers over qualifications for top bank jobs. Picture: Phil Wilkinson
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BANKERS will have to earn formal qualifications if they want to work in the industry, under Scottish Government plans to rebuild lost public trust.

The move follows widespread anger when, at the height of the financial crisis, it emerged that the heads of Scotland’s collapsed financial giants had no formal industry qualifications.

The government strategy for banking calls for a return to “traditional Scottish banking principles of professionalism, stewardship and prudence”.

This includes an end to excessive bonuses and a “zero-tolerance” approach to mis-selling.

A new Scottish business development bank is to be created in an effort to boost lending to small firms and kick-start the economy.

New professional standards and qualifications in banking are needed, the strategy states, to “restore trust and achieve cultural change in the system”.

Fallen banking bosses such as Fred Goodwin of RBS, Andy Hornby of Bank of Scotland and Adam Applegarth of Northern Rock compounded public anger over the financial crisis when it emerged that none had any formal banking qualifications.

The number of bank staff in Scotland with such formal qualifications has “declined significantly”, the report says.

Bank staff in “key senior and customer-supporting roles” should be required to become members of a professional body, industry leaders say, and any breach of this could incur sanctions, including potentially being struck off.

“The Scottish Government will work with the Chartered Banker Institute and the banks in Scotland to encourage maximum support for, and uptake of, the ‘Foundations Standard’ and to promote the chartered banker designation for all appropriate staff,” the report says.

“The Scottish Government will also consider with the institute and the banks what the options might be for making membership of a professional body mandatory for bankers in order to bring banking closer into line with other professions.”

The report added that ministers could look at changes in regulation after independence to encourage the growth of mutuals and increase competition and diversity in the system.

Tory finance spokesman Gavin Brown said: “All banks operating across the UK benefit from working with one set of rules but under independence they would be forced to comply with two. This would bring costs to their businesses, costs which would ultimately have to be borne by their customers.”

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