Clearly some parts of the banking industry have behaved irresponsibly. There needs to be significant change in both the regulation and governance of the banking industry to prevent a repetition of the excessive risk-taking and greed that has helped cause so many of today's problems. There can be no going back to the bad old ways. But this has been a global, not just a British, phenomenon – and it involves only a part of the financial industry.
It is certainly not a reason for politicians and policymakers to start undermining the UK financial sector – which is one of this country's great national assets. There is a very real danger that we shall end up doing irreparable damage to one of the strongest sectors of our economy. Financial services are something at which we British excel. Why do so many of the brightest people from around the world come to work in the City? Why do corporations, institutions and governments around the world bring their money and their business here?
Because we offer something unique – an unrivalled mix of skills, good regulation, a dynamic environment and a proven ability to adapt and evolve. In short, the City is a world-class place to do business. The UK is an international leader in financial services – a high value-added part of the global economy – and that gives us a tremendous competitive advantage.
Furthermore it is nonsensical for politicians and others to suggest that the UK financial sector is somehow "too big" for the UK economy when much of the business conducted in the City is international business, servicing international clients. It has no bearing on the UK economy except – and this is absolutely crucial – that much of the value added remains in this country.
The City, and financial services more generally, are vitally important to the UK economy, to UK employment both directly and indirectly, to government revenues and to UK pension funds. UK financial services employ more than one million people – and more than two-thirds of those jobs are outside London. UK financial services account for about 8 per cent of national output and contribute some 14 per cent of total tax revenues in this country.
Taken from a speech by the chairman of Lloyd's to a City dinner last week