Incentives encourage us to rip off customers, admit bankers as three quarters say excessive pay can encourage them to break the law

• More than 1,000 finance workers were surveyed about pay in the industry
• 75% said some bankers are  'still paid excessively'
• Two-thirds say they 'inappropriate behaviour' is encouraged

Cash: Five years after the financial crash banks admit they are still being paid excessively

Three quarters of bankers say some colleagues are paid an excessive amount that can encourage them to break the law, a damning study revealed yesterday.
Nearly five years after the financial crisis began in 2008, the report interviewed bankers themselves to highlight how little discredited working practices had changed.
It follows a devastating few years for an industry that the taxpayer was forced to bail out, only to see banks hit by a series of self-inflicted scandals including manipulating interest rates, ripping off vulnerable investors and mis-selling loans to small firms.
The report, from the Chartered Institute of Personnel and Development, suggested some of this unethical or illegal behaviour was a direct result of profligate salaries that ‘incentivise inappropriate behaviour’.
Despite such high-profile failures, the report says 75 per cent of bankers agreed some colleagues were ‘still paid excessively’.
According to the Office for National Statistics, the average salary of a man working full-time in the City of London is nearly £100,000, compared to the £36,000 average for men in full-time work across the whole of Britain.
The CIPD, which quizzed more than 1,000 finance workers, including nearly 500 bankers, said: ‘Almost two-thirds [65 per cent] of employees agree that some people in their organisations are still rewarded in a way that incentivises inappropriate behaviour.’

 

One in five bankers said they had ‘felt bullied or put under excessive pressure to behave in ways that are counter to their personal ethics or the interests of customers within the last two years’.
But it is the money, more than anything else, that made so many bankers chose to work in the industry in the first place.

Survey: More than 1,000 finance workers were quizzed about their work, and two-thirds said pay deals caused people to behave inappropriately

When asked why they went into banking, the most popular answer – given by a third of respondents – was the high salary and bonus.
Peter Cheese, chief executive of the CIPD, said: ‘For too long, many of our financial institutions had been built on cultures that encouraged and rewarded excessive risk-taking and singular focus on short-term financial gain.’
But nearly half of bankers said there had not been ‘any initiative’ over the last year to change the culture.

Former Barclays Chief Executive Bob Diamond (left) claimed two years ago that the time for 'remorse and apology' was over while Sir James Crosby, the former chief executive of Halifax, is one of the few senior bankers to apologise

Few top bankers have apologised, with former Barclays boss Bob Diamond criticised for claiming in 2011 that the time for remorse was over.
A spokesman for the British Bankers’ Association said: ‘Pay practices have been completely transformed. Since 2007, the total bonus pool has dropped by 55 per cent and bankers in London are now paid less than they are in rival financial centres such as New York, Singapore or Hong Kong.
‘Banks are rewarding staff for high levels of customer service and not sales volumes.’