On the senior executive floor of Barclays' steel and glass Canary Wharf headquarters, portraits of the bank's Quaker founders adorn the walls outside the suites of the company's current crop of bosses. What would they wonder if they knew what fate had befallen their much-admired and trusted institution? More to the point, what do their modern-day successors think, as they go about their business?
For, heaven forfend that the chairman, Marcus Agius, and the chief executive, Bob Diamond, should even meet their forebears' collective gaze. They have an awful lot of explaining to do. Not least, how a bank that once stood for honesty and solidity should be fined £290m for manipulating the interest rate upon which millions of individuals and businesses across the globe rely. The traders who did so – it is not clear if they acted with their superiors' cognisance but if they did not, then why didn't the highly paid corporate titans know what was occurring? – were out to maximise profits from their dealing, represented by that most insidious of peculiarly City carrots, the end-of-year bonus.
Barclays, we know, was not alone – other banks, too, have been caught up in the same scandal. Indeed, rather than fight the regulators, Barclays has done the honourable thing of coming clean. But lauding stops there. The bank's behaviour was reprehensible. It may, who knows, prove criminal. This from an organisation that prided itself on having escaped the fate of its rivals as the state had to intervene to directly rescue them, that liked to point to its origins as evidence of some higher calling.
What was it Mr Diamond told MPs, as he attempted to lead the industry out of the ruins of the credit crisis? That the "time for remorse is over". They were mocked then and have been laughed at ever since, as many bankers have continued to earn astronomical sums, while much of the rest of the economy suffers.
Mr Diamond's statement now rings completely hollow. What's clear from the exposure of Libor-fixing at Barclays is that the culture of greed and financial malpractice is endemic across the industry. Indeed, one of the most shocking aspects of the whole affair is the sheer callousness of the traders involved.
The divide between that and the smooth, urbane public image propagated by Messrs Agius and Diamond is enormous. It is one that society has singularly failed to address. The same animal instincts that drove banks to push loans on hapless "sub-prime" borrowers in America's Midwest, with disastrous consequences for the world's economies, are prevalent again.
Politicians have attempted with varying degrees of rigour to introduce rules preventing a recurrence. Mostly, in the face of determined lobbying by the banks (led in the UK by Barclays), they have retreated or watered down their proposed measures. But it is obvious now that the authorities are only scratching at the surface: a far stronger hand is required.
For a start, they should act immediately and decisively. Fining a bank has little effect: what is required is the naming and shaming and driving from office of those involved. The era of entitlement – something we hear an awful lot about in relation to those at the other end of society, on benefits – must be brought to an end for bankers. Incredibly, only one UK top banker has been punished for his bank's role in provoking the credit crunch: Fred Goodwin lost his job and subsequently, his knighthood. Now, with a second storm engulfing the sector, that cannot be allowed to happen again. Light-touch regulation and, with it, light-touch penalties should be banished. In that respect, Bob Diamond is right: the time for mere remorse is well and truly over.Reuse content