Expert chosen to lead new banking standards body

The move comes in the wake of recommendations by the Parliamentary Commission on Banking Standards and marks an attempt by the banking sector to repair its tarnished image following a series of scandals, including Libor rate rigging and mis-selling of payment protection insurance.

In a joint statement, the chairmen of Barclays, HSBC, Lloyds Banking Group, Royal Bank of Scotland, Santander and Standard Chartered said Sir Richard would design and head up the new body for banking standards, stressing it will be run independently and not lobby on their behalf. The new body is charged with “setting and promoting high standards of competence and ethics”, they added.

Sir Richard – also formerly editor of the Financial Times and an ex-member of the Bank of England’s rate-setting Monetary Policy Committee – will initially consult on the remit of the new body, canvassing opinions from government, regulators, academia, industry, existing providers of qualifications and training, employees and consumer organisations.

He will look at the need for standardised skills and qualifications across the industry and how best to raise professional standards, liaising closely with the Financial Conduct Authority.

Sir Richard has been asked to report back with recommendations for the new body in the new year. He said: “The new professional body will be independent of the banks, and will cover all sectors of the industry.

“I hope it will be supported by all banks and building societies doing business in the UK.”

John Cridland, current director-general of the CBI, welcomed Sir Richard’s appointment. He said: “Restoring trust in our banking system is absolutely fundamental to the future of the UK economy and I can think of few people better qualified to do this than Richard. His breadth of experience and fearless independence are exactly the attributes needed to address the cultural and professional challenges which parts of the banking sector face.”

Sir Richard insisted it was possible to come up with a “rigorous and clear and open” process for recruiting the new body that would “demonstrate that this outfit is not going to be a bunch of patsies”.

The former journalist said he would learn from the lessons of the discredited Press Complaints Commission, which was “a perfect model in how not to do it”.