Banking sector remains unchanged

Hat tip to Barry Ritholtz of The Big Picture

http://www.ritholtz.com/blog/2010/01/banking-sector-remains-literally-unchanged/

Jordan notes that the folks who run the major banks today — the senior executives, directors, managers, etc. — are essentially the same exact folks who ran them (into the ground) 5 and 10 years ago:

“The prospects for a robust prudently guided financial sector have been substantially clouded by the fact that the both the corporate governance structure and the executive leadership of the financial sector remain largely unchanged—92% of the management and directors of the top 17 recipients of TARP funds are still in office.”

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One Response to “Banking sector remains unchanged”

  1. Carole Martinez Says:

    …..Earlier this week I went on Radio Five to talk about Lord Turners suggestion that the directors of failed banks should face having two years salary clawed back by the financial regulators available at 1 49 00 . Surprisingly enough I didnt think much of the idea…It is true that Lord Turner is identifying a real and serious problem bank directors are sometimes insulated from the consequences of their business decisions and have an incentive to take on more risk as a result…But as well as being ethically dubious the burden of proof would rest with bank directors who would be forced to justify perfectly legal activities or face arbitrary punishment Lord Turners proposal is a distraction from the real problems in the banking sector. ..The result of these government interventions is that the banking sector is hard-wired for risk in a very fundamental way.

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