Having shown the entire world just how incapable they really are, bankers from CEO's to post boy, should halve their salaries and fees immediately.

once again, Lausanne, Switzerland

Peter Goddard everybody except you is saying Billion. I think you'll find that everyone in banking uses the US system of millions and billions.

emily W, cambs, uk

Patricia,

Speak for yourself - I think it's hilarious!

Alex, London,

Are the banks that bothered? No, of course not. They don't care, it's not their money. The UK banks have decided that they have to make an annual profit in excess of £35 Billion pounds, to support their lifestyle. If money is a bit tight in one direction, they'll just put up bank charges to compensate. If they can't do that, they'll increase the difference between the interest they pay savers and the interest they charge borrowers.

David Leslie, Perth, Scotland

This is a very good article and the Professor's findings are no surprise. I reckon you could take 100 directors from the board's of any banks, sit them down and give them an examination of their knowledge of risk assessment, debt markets, foreign exchange markets, derivative markets, bond markets, clearing and settlement systems and 95% of them would fail. Over the past 20 years, banks have been taken over by snake oil salesmen, prudent bankers have been pushed aside in the rush for quick profits. The focus is on obtaining as much business through the door as possible regardless of quality. The purpose of this approach being to quickly expand the bottom line with the result of increasing the share price and consequently the value of options held by the senior management, not to mention higher bonus payments. The interests of the shareholders, the customers and the general staff of the banks are irrelevant as far as the snake oil salesmen is concerned, he has only one thing in mind.

Scott, Bangkok, Thailand

Ms. Senior:

Right on! I would add only two points:

(1) There is indeed a mismatch between short-term (banking executives') and long-term (investors') views, but don't expect "banks" = "banking executives" to address it - only investors or third-party regulators will.

(2) The same mismatch occurs among many large public corporations - it just happens to be most visible in banks and the financial industry because their heavy use of leverage amplifies the problem.

Jim Murphy, Ithaca, New York

Gareth, I am sorry but it is not even funny !

Patricia , London,

You still haven't cottoned on yet have you? Money doesn't exist in banking. Its just a number in a computer, which makes it a game. The easiest way to fix this is to pay all bankers in hard cash, deducting any losses from the sum before handing it over.
While we're at it, let's take a look at how we remunerate our politicians ...

KR, Stockport,

Dude, we are all dead in the long-term. How will I eat a £1,000 lunch when I'm six feet under?

Gareth, London,

Bankers have always been profiteers. But they used to be discrete. However this epoch has definite seen the birth of the "Bankers Dozen" (pay for 12, and get 11.) If you wish to know how this all came about, see the film on the internet, "The Money Masters" at http://www.informationliberation.com/?id=8702
You will find that banking is VERY much dirtier than it appears to be and is the greatest threat to Democracy that has ever existed.

victor compton, Cherbourg, France

The research fits in with everyone's experience of banks. As you rightly say, bank managers were respected members of society - usually unhelpful but respected!

Nowadays they use every trick in the book to charge you fees and when told that their fees are illegal, refuse to give the money back!

There is a huge ethics problem in banking (but also in the government and other big business as well). In my view it started in the 1980s under Thatcher where the philosophy "if it makes money it is good" was proudly trumpeted. Thatcher probably never meant it to include all sorts of dodgy deals, deceitfulness or plain corruption, but much of the rest of the world did.

If big business is unethical and corrupt, how on earth do you persuade the little people that they should be straight?

Unfortunately fraud is widespread and the police are almost powerless. We need a massive cultural change where there are massive penalties for those at the top fail to set a good example to the rest.

Alistair Nicholls, Manchester, England

The rot set in when investment banks switched from a partnership system to being publicly traded. In the past a bank trying to sell a deal in which its own capital was not at risk was regarded as trying to dump a problem child on someone else. Meanwhile, partnership meant that the bankers had their own personal fortunes at stake ... investment bankers made their big pay-off when they left the business and "cashed out" of the partnership.

Now you have highly mobile bonus hounds -- who have no equity in the bank, and often leave in 3-years or so, roughly when the brown-stuff hits the fan, with accumulated bonuses intact.

The best solution would be to pay in shares. The bank would bonus bankers with restricted stock plus enough cash to pay the tax -- the stock would be restricted so that it could be sold over say 1-5 years, a chunk at 12 months, 24 months, etc.

Frankly I would pay fees in M&A deals to the banks in the same way -- it would keep them honest.

MacK, London,

Banks have been casinos over at least the past 3 cycles. The Central Banks turbo-charged them with huge liquidity injections over the Y2K Scam and created the Dot-Com Boom and then the Housing Boom....all deliberate infusions of credit just as now.

Western Capitalism has boomed on cheap credit and sold its birthright to China for recycled low-interest credit moving workers from factories to services and to hawk insurance/property-based policies instead of goods.

Britain is now a country with a cost-base higher than Germany because of lax credit and lazy, greedy service sector employees who are unable even to sell and merchandise having gown fat on credit-fuelled demand.

These were truly The Locust Years

CCTV, Bristol, England

Antonia, you make the point about our pension and investment money being exposed to the same markets. We are all told to take a long term view but along that journey we are robbed by speculative insider trading. We also have upfront charges and annual management fees so the City is always in the winning seat. Even the Government takes a cut of our pension investments. No wonder people have prefered to speculate on property!

Steve Marchant, Broadhempston, UK

I could not agree more with this article. The banking system has got out of hand and needs to be brought back in line. They know full well that no matter what, the government will bail them out; Northern Rock is the prime example. NR should have been left to crash like any other businesses, or if the banks were worried, then they and not the tax payer should be footing the bill for the management's incompetence and crass stupidity. But it seems no one is willing or capable of bringing these people back into the real world. Their fantasy land where the only motivation is greed for the quick buck will continue to cause problems to the general public. Short term vision and even shorter terms investments eventually will crash not only the banks but other industries and the system will implode.

loris, milan, italy

Too much greed not enough law. What the banks have done with sub-prime should be criminal. They knowingly sold deliberately disguised dodgy loans to other financial institutions in the name of quick profit and bloated un-earned bonuses. The same goes for most many of our profiteering shops and utilities. Too much emphasis on profit and pocket lining and not enough about the people being ripped-off. Hey, but if the government can do it to the people.....

David Thijm, Stourbridge, UK

I wouldn't hold my breath.

It is, afterall, other people's money!

Chris, Worcester,

Less honest, less loyal and less self-discipline than the average! And these were the people who agreed to be interviewed. One hears denials all the time, but one cannot help think that many confident human beings cannot be trusted in business matters where money is involved: And those responsible for the present debacle will now happily retire to their Texas ranches with millions in the bank with all the world so very very sorry for them.

Brian Lewis, Manila, Philippines

As with all things financial, banks reduce the world to numbers thereby avoiding the tough ethical questions. It's the kind of freedom we Americans love, but it's made us amoral. Ms Senior would do well to follow her intuition though I don't doubt it'll cost her her job.

Tony Somera, Champaign, Illinois

Indeed ... some very serious questions for the 'very clever' finance captains to answer. One more question from me : as I watched a very senior ECB captain tells us that 'innovation' is necessary and should be allowed to continue, I could not help wondering, as the glaring downside of all that innovation hits, what exactly is the upside, for the rest of us that is??

Rob Domloge, Nagoya, Japan

Not very sure of Prof. Roger Steare's methodology. Having been for more than 35 years in Banking and having in the past headed International Operations of State Bank of India, I have reasons to believe, with whatever little I learned, that a normal bank employee has as much honesty and integrity as any one else. I am not so sure of so called investment banks who are in the wholesale business and life cycles of senior mangers is measured in months and not decades.Will some one throw some light on Prof. Steare's methodology

rajendra asthana, Mumbai, India

You make such sweeping generalisations. The vast majority of people working in financial institutions are paid fairly for the amount of blood, sweat and effort they put into their jobs and the amount of value they consequently give to their employer. Yes, there are excesses at the very, very top. But the banks are huge and there are thousands and thousands of employees working for them who are loyal, have integrity, work hard and deserve to be compensated in kind.

Anne Edwards, Leatherhead, Surrey

Hi,T
The retentive evens surrounding Soc Gen the French bank is indicative. I have been trying to recover a million dollars that has aberrantly disappeared in some black hole of the bank. The French food is nice, The women are dangerous. The strange habit of historically cutting the heads of people must be considered with distance. The best perdition of the future is to take the average of the past.
Regards Dr. Terence Hale Zandvoort

Terence Hale, zandvoort, Holland

"Most people, historically, have NOT lived their lives as if thinking, I have only one life to live. Instead they have lived as if they are living their ancestors' lives and their offspring's lives ..."
Tom Wolfe / "The Culture of Narcissism" by Christopher Lasch :1979

Jeffrey Moore, Toulouse, France

Dear Ms. Senior,

I think that rather than tarnishing all "bankers" with the same brush, you should perhaps have also considered the banking industry outside the investment banking fraternity. There are other and greater parts of banking that you cannot possibly connect to the investment bank. We work in the retail, corporate and private banking divisions and continue to offer our clients long term solutions to their needs, without being paid anywhere near the sort of money that our investment banking colleagues receive.

In future you should do your journalistic homework better and not do as most journalists do, take the minority as a representation of the majority.

Sean, Geneva,

4.9 milliards (4 900 000 000) euros NOT 4.9 billion (4 900 000 000 000).

In Europe the "British System" is used where:

Thousand is 10 to the power of 3
Million is 10 to the powwer of 6
Milliard is 10 to the power of 9
Billion is 10 to the power of 12

Unless one is American, which one is not.

Peter Goddard, Epsom, England, EU

How about the old adage of reward and PUNISHMENT?
Certainly those bankers who incurred in gross negligence (yes, we knew we were more than likely to cause serious damage to people, but what the Hell) could sit out a few years in the shade, and I don't mean the apple tree.


MAGNA CULPA DOLO EST.
(Gross negligence is a crime).

Eugene, Heidelberg, Germany