Monday 13 December 2010

How badly run are banks?

Interesting insight into the extent to which the British public thinks banks' governance has deteriorated over the last 22 years. According to the British Social Attitudes Survey, the percentage of the public saying banks are well run has crashed from 91% in 1987, to 19% in 2009.

This longterm trend provides some explanation why politicians and regulators seem happy to proceed with further intervention in banks' governance regimes despite a lack of concensus around the root causes of the credit crunch. While researchers and bankers have done a good job of examining limited aspects of the credit crunch, the wider narrative has congealed around banks being poorly run.

And, to give this deterioration some context, over the same time period, the percentage of the public saying the NHS is well run has improved from 35% to 54%; trade unions has improved from 27% to 35%, and even the press has remained static at 39%. Surely time for the banks to take a more proactive role in explaining how their governance woes are being addressed?