The bankers bite back
It was the day the bankers bit back. They clearly are concerned about the G20 agenda of President Sarkozy who is chairing the group this year. At home there is concern about the direction of travel of the Independent Banking Commission. And a senior Cabinet Minister said here that all options are on the table if the “deal” over lending more and lower bonuses breaks down in the next few weeks.
But the tone from the financiers was defiant rather than contrite “time to move on” said one to me! Pointing, not unreasonably to the fact that the top 10 in world banking is now half Chinese.
And so Jamie Dimon, the combative JP Morgan chief executive (who did not take a bailout) decided to lash out against banker bashing. And then he went as far as confronting President Sarkozy at his Q&A here.
“Banking system is not in the shadows. There’s far more transparency, there’s better accounting. I think it will be important when we go to the G20 when it comes to financial reform that people take a deep breath. A lots been done, there’s a huge cumulative amount. Too much will be too much,” said Dimon.
An annoyed looking Sarko responded:
“Well, do we need banks for the economy to function, well obviously goes without saying. But think back to what actually happening. Everything was fine and dandy…and then one day the unthinkable occurred. Have we already forgotten? One major American bank went bankrupt, went under. And it’s not insulting or incriminating anyone. We haven’t forgotten two years after the event. The world was gobsmacked to see one of the big American banks fall like a pack of cards.”
Peter Sands, the Standard Chartered chief exec (again no bailout), also posed a challenging question. It almost seemed coordinated.
Sarko said the banks had and were engaging in the madhouse rather than the market. And for good measure he said he thought there should be a small financial transactions tax, popularly known as the Robin Hood Tax, to fund development challenges.
Sir Howard Davies, the FSA Chairman thought that the bankers had overstepped themselves, and probably guaranteed lots of bank bashing under France’s G20 presidency. There will be plenty of international pressure on the Chancellor and Prime minister this year, it seems, on top of the bankphobia of their Coalition partners.