In the UK, the atmosphere between banks and their regulators has grown quite poisonous.
The UK government abandoned the chief executive of RBS Stephen Hester, a man recruited to clear up other people's mess, when the bank’s board dared to grant him a portion of the pay due under a compensation plan voted through by shareholders, including the government itself.
Many UK bankers are still bridling at a widely reported speech by Robert Jenkins, a member of the Bank of England's (BoE) Financial Policy Committee (FPC), in November, in which he accused those who responded to reduced availability and higher cost of capital and funding by reducing their lending to the real economy of indulging in a lobbying tactic against prudential regulation that is “intellectually dishonest and potentially damaging”.
Bankers’ social standing and reputation have been so damaged by the financial crisis that probably only journalists are more despised. So it’s still interesting to see what exception they take to being branded liars. Neither do they accept the lectures from various figures at the BoE, such as from governor Mervyn King, that they can easily withhold dividends from shareholders and still raise more equity capital rather than reduce assets.