The FT, Guardian and others note that HSBC was full of regret at its results announcement yesterday.
As the Guardian put it:
The chairman of HSBC warned yesterday that fear of hefty fines was forcing banks to become risk averse as they grapple with unprecedented regulatory reforms in the wake of the financial crisis.
In fact, he so regrets this burden that he has written to anyone he hopes might listen to ask that the splitting of banks, designed to protect us against a future crash, be delayed from its already absurdly late proposed date in 2018. If not we may suffer as he puts it, and as is quoted in the FT, suffer:
an observable and growing danger of disproportionate risk aversion creeping into decision-making in our businesses as individuals, facing uncertainty as to what may be criticised with hindsight and perceiving a zero tolerance of error, seek to protect themselves and the firm from future censure.
If a few more people checked bank statements it might help his organisation, but despite the fact that they apparently can't get such basics right he stills wants less regulation. What for, you might ask? Well the FT notes his lament relating to:
the lack of innovation in wealth management products because of the risk of mis-selling allegations.
Now let's just consider that issue alone for a moment. What Douglas Flint appears to be saying is that he regrets the chance to sell customers insurance they did not need and could not claim on. And he regrets having to send them proper statements that remind them they can repay the bank if they so wish. Perhaps he also regrets not being able to sell so much tax abuse. Perhaps he regrets the fact that HSBC's Swiss private bank can no longer hide tax evasion. Perhaps he regrets the fact HSBC can no longer money launder for drug barons in the Caribbean. Is that the sort of innovation in wealth management products he regrets no longer being available?
Whilst the rest of us would just like a bank who can get basic banking right banks have no such aspiration. That means that there is an appropriate regret with regard to the likes of HSBC, which is that more has not been done to break them up to protect us all from what they do. But bankers have a very different regret. They regret that it's no longer the spring of 2007 and hanker for it still. Which is why everyone else needs to be very vigilant indeed.
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Are the banking changes starting in 2019??
I quote CNBC from yesterday, I am sure you watch as well, time of course being the issue. However I might has misheard which is possibly why you are right with 2018.
Vickers is meant to be in place in 2018
I do not have time to watch CNBC – sorry!
According to whistleblower Nicholas Wilson HSBC have unlawfully charged up to half a million customers an average of £1,500 ‘collection charges’ http://nicholaswilson.com/ . This seems to be an additional potential cost to HSBC that has not been allowed for in their present calculations.
Thanks for heads up!
And yet again we are reminded of the pointlessness of the banking bailout, because quite evidently, the fools in charge of the banks have learnt nothing. The same greed, the same recklessness, the same whining about regulation. The banks should have been nationalised and put under government control, much as Richard has proposed in his plans for a green investment bank. Either we have proper capitalism, where the price of greed, recklessness and incompetence is to go bust, or, if banking is too important to left to fail, it is not something the private sector should be doing. How much more proof does any sane person need of this?
Actually, we used to have an excellent public sector bank in the UK, I started banking with them age 18. It was National Girobank, run through the Post Office, and it provided an excellent, basic banking service. So of course, it was privatised, sold off t Alliance and Leicester, when they were still a Building Society. Then of course they demutualised, and not so many years later, as part of the financial crisis, they went cap in hand to Santander, who took them over.
Oh look, it’s the ‘superior efficiency of the private sector’ , yet again!
I notice that you did not include the second half of the quote from the FT. After mentioning wealth management, it said “and the delays of granting loans to commercial clients caused by having to carry out due diligence.” I am not a banker but I would have thought that a bit of due diligence on potential borrowers may help reduce your risk of bad loans.
I decided to take one issue
I was amazed at the second part, as it seems you are
Apparently he just wants to flash the cash
Intriguing
Richard, when you say you are intrigued, you are being too kind. Appalled would surely be a better word for this example of reckless stupidity. How the hell can the chairman of a bank the size of HSBC even think of saying such a thing? Isn’t carrying out due diligence checks a basic, fundamental requirement for a bank when it lends money?
As I understand it, the straw that broke the camel’s back for RBS was that Goodwin was so eager to take over a certain Dutch bank that due diligence checks on the state of it’s loan book weren’t carried out; if they had been, they would have discovered that the state of it’s loan book was such that (as was subsequently proved) it shouldn’t have been touched with a bargepole.
Bankers simply can’t be trusted to behave in an ethical or competent manner.
The same is true of Lloyds and HBOS, of course
And the Coop and Britannia
Need we go on?
Is it time for Icelandic solution to be rolled out worldwide?
Not sure….
It may not work outside a small place
Gaol-time concentrates the mind.
However, due to Crony-Capitalism (AKA corruption), the “pass and go to gaol” option is nor on the table.
Personally, I like to refer to HSBC as “Shanghai Lil’s” but in fairness you might have got a better deal at Lil’s.
‘Might’?