HSBC head hits out at bank bonus culture

Stephen Green, the chairman of banking giant HSBC and the British Bankers' Association, said that the industry "had very good reason to be uncomfortable, looking backwards".

Mr Green, an ordained Church of England minister, said there had been "plenty of distortion" in bank pay which had given rise to "wrong and frankly inflated" bonuses. But he added: "As this newer environment beds down, I think you will see a market working in a way that we don't need to be ashamed of."

Mr Green's intervention follows the super-tax on bonuses introduced by Chancellor Alistair Darling and an attack on "obscene" payouts by US President Barack Obama.

Goldman Sachs last week unveiled a 10bn pay and benefits pot, but said it had shown "restraint" after limiting the total compensation of its 100 London partners to 1m.

It is not the first salvo against the banking industry by the HSBC boss, whose book Serving God? Serving Mammon? attempted to reconcile Christianity with financial markets.

Last year he argued that swathes of the banking sector simply lost

their moral compass in the "go-go years", causing a "major breakdown in trust".

"It is as if, too often, people had given up asking whether something was the right thing to do, and focused only whether it was legal and complied with the rules."