- Bankers’ Code should be led by the banking industry, not regulators
- Code to enshrine three core principles
- A ‘virtuous circle’ between banks, customers and shareholders needs to be reinstated
As confidence and trust in the banking industry reaches new lows, KPMG’s UK head of financial services, Bill Michael, calls for a Bankers’ Code – led by bankers, overseen by an independent body, with the endorsement of regulators – to be introduced.
Speaking at the annual British Bankers’ Association conference on the future of banking, Bill Michael said:
“Step-changes to rules and regulations will not be enough to rebuild trust. The industry is in need of a ground breaking shift in culture and behaviour. It is up to the banks to lead by example by developing and implementing a Bankers’ Code – that is real and has the backing of regulators and other industry stakeholders. After all we have ‘tone from the top’ and ‘three lines of defence’ yet no real principles based foundation.
“Bankers should run banks, not regulators or the government. Unfortunately today bankers are being shut out of the future shape of banking, which will ultimately be to the detriment of us all. A Banking Code can help turn this super-tanker around by providing a clearer framework for supervision and encourage an environment where banks can regain the right to challenge regulators.”
Bill Michael outlines three core principles which should be enshrined in the Code:
- First, act in the best interests of the customer;
- Second, put reputation before profits; and
- Third, live by the principle of prudence.
“There needs to be a genuine public commitment by the Board and Senior Management to be guided by these principles in everything they do. These principles should work together to anchor decision making from the top of the house all the way through its roots and branches.”
Notes to editor:
Copies of the full speech are available on request and Bill Michael is available throughout the day for interviews.
For further information please contact
Monica Fiumara, Senior PR Manager, KPMG
Tel: +44 (0)20 7694 5674
Mobile: +44 (0)7901 105180
KPMG Press Office: 020 7694 8773
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with nearly 11,000 partners and staff. The UK firm recorded a turnover of £1.6 billion in the year ended September 2010. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 150 countries and have more than 138,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.