As Mervyn King, governor of the Bank of England, described; "Of all the ways of organising banking, the worst is the one we have today". The system of finance and banking needs to change and the UK government are aware of this, which is why they set up the Independent Commission on Banking (ICB) that will make its recommendations in September. Despite this, I am worried that the status quo will prevail. My Uncle Harry told me today that in Holland they have already had banking reform, and that nothing has changed as a result.
Today two things have come to my attention that made me feel positive that things CAN actually change. Two public figures, Robert Peston from the BBC and Sir John Vickers who is chairing the ICB both took action which promises that people in the 'right places' are thinking about regulation vigorously and boldly.
Robert Peston's documentary Britain's Banks: Too Big to Save? features both established bankers (e.g. Paul Tucker, deputy governor of the Bank of England, and likely to be the next governor) and less conventional critics damning the current system. One of the interviewees that struck me was Professor Robert May (who I have just invited to speak at the roundtable!), a zoologist who has been applying insights from his research into ecosystems to banking. Another participant, Tony Baxendale of the Cobden Centre, spoke at the Positive Money Conference at which I first became so interested in money and banking!
Secondly, the front page of todays FT reveals that Sir John Vickers is adamant to break big banks up despite the international difficulties. He'll be making a speech this weekend at the London Business School which will further reveal his opinions in anticipation of the ICB options paper that will be published in April.
I will be interviewing Sir John next week. Any questions? Let me know. £