Two-thirds of Brits still don’t trust banks
Ten years on from the financial crisis, survey finds trust for banking system in short supply
Ten years on from the collapse of Lehman Brothers, two-thirds of Britons still do not trust banks and think they did not face severe enough penalties for their part in the financial crisis, a survey has shown.
The YouGov poll on behalf of campaign group Positive Money found 66% of adults in Britain do not have faith in banks to work in the best interest of society, while 72% believe banks should have faced more severe penalties for their role in the 2008 crash, which led to a decade of austerity.
Many are also critical of the £45.5 billion public bailout of RBS, which on Wednesday resumed paying dividends for the first time since the height of the crisis in a bid to attract investors.
Since 2008, banks globally have paid the price financially and reputationally, paying out more than £252 billion in fines as regulators probed them for mis-selling securities and rigging interest rate and foreign exchange rate benchmarks.
They have also undergone a series of reforms and been subject to stronger regulation; increasing levels of capital banks hold, separating depositors’ money from riskier investment banking activity, and making senior bankers more accountable.
Yet despite years of restructuring and paying fines and compensation for misbehavior, the survey “underlines the extent to which banks still have to work to rebuild trust” says Reuters.
“This should not come as a surprise” says Postive Money’s Simon Youel in Left Foot Forward.
“Banking behaviour is still irresponsible, unfair and neglectful” he writes. “Banks have not changed their lending habits, and continue to divert funds towards speculation on property and other financial assets rather than the productive economy”.
On top of that, “bankers are continuing to pay themselves huge bonuses, while living standards have stagnated for everyone else” he adds.
That is perhaps why, despite much touted reforms over the past decade, 63% of the public are worried that banks may cause another financial crisis.