Move over Simon Cowell, there’s a new pariah in town. Where once it was lawyers, estate agents or traffic wardens, bankers are now Public Enemy No 1. Like it or not, bankers have been roundly blamed for causing the Credit Crunch. Media hysteria continues to escalate as bankers are accused of pocketing multi-million pound pay-offs while everyone else makes do and mends.

Times, clearly, are tough. The FTSE is plummeting, financial indicators provide scant encouragement and Government efforts to kick-start lending appear to be making little headway.

The charge sheet for Bankers is considerable. Bonus structures based on volume rather than quality were clearly misguided while allowing individuals to borrow on many multiples of their income was just one more sin among many.

‘Bankers are easy to kick’ laments Liz Edwards, Head of UK Real Estate Finance, Landesbank Berlin. ‘I groan when I see yet another article about ‘Fred The Shred’, 99.9% of bankers don’t have pensions of £650k per year. The public needs someone to blame and ‘swanky bankers’ are sitting ducks.

‘Everyone loved us when times were good. Personal credit was easy; everyone was trading up on clothes, cars, holidays and lifestyles. The simple fact is that greed was endemic but people would rather not face up to the consequences of their own actions’.

Bankers may be culpable but blame is hardly theirs alone. Rating Agencies appear to have emerged irritatingly unscathed from the carnage despite their pivotal role in the crisis.

One man’s stock continues to rise. Robert Peston has become a hate figure across and beyond the Square Mile. While detractors accuse Peston of dealing in sensationalism, admirers note that making headlines and selling newspapers is simply what journalists do.
‘Joe Public is kept in the dark about the real issues’ declares Ray Ellis, Alliance & Leicester. ‘People are looking at their falling investments and the value of their houses, the fact that their jobs aren’t as secure as they once were. The facts may have been simplified for public consumption but people have a perfect right to ask how banks lost so much money?’
On the front line, bankers remain busy. In a sanguine environment, margins are heading back to mid-nineties levels and banks previously labelled as boring are reaping the rewards of conservatism.

Prevailing wisdom suggests that Commercial Property investments remain sound in the medium to long term. Time will tell if the reputation of bankers takes longer to restore.

‘What will it take?’ ponders Barry Worth, Senior Lending Manager, Nationwide. ‘Once things turn around, banks should be paid a fair reward for the risks they take while behaving reasonably towards clients - not squeezing every last drop just because they can. The credit crunch isn’t totally to blame for the way we’re perceived’.

Things can change pretty quickly. As an example, just a short while ago, Fred Goodwin was regarded as a first class banker and the general attitude was ‘do the business, make me money!’ Bankers are feeling the heat at present but a new pantomime villain will come along soon enough’.

Presidents blog

Breakfast Seminar with PFF
I hope to see lots of APB members on Thursday morning for our joint breakfast.

Events blog

Good morning all APB members
A reminder of an IPD event you are all invited to register for 6th IPD RealWorld Conference.

Guest blog

Information Sharing
Competition authorities are increasingly targeting information sharing between competitors.

PREVIOUS Property Finance Forum - Retail Focus - November 2010

UPCOMING

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PREVIOUS APB Pumble

UPCOMING

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November

Annual Fundraising Dinner. Tickets will be
available for members from the middle of July and non members from August.