Business

Richard Lambert, ex-CBI chief, to lead UK banking standards body

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Media captionSir Richard Lambert: "It has to be independent... so people will say, 'They're not a bunch of patsies'"

The former head of the business lobby group the CBI, Sir Richard Lambert, is to lead a new organisation monitoring standards in the UK banking industry.

Sir Richard has been appointed by the banks but will act independently of them and not lobby on their behalf.

He will consult government, regulators, banks and consumer groups to develop the new body.

Its creation was recommended in June in a report by the Parliamentary Commission on Banking Standards.

The appointment was announced in a joint statement by the chairmen of the five largest UK banks: Barclays, HSBC, Lloyds, Royal Bank of Scotland (RBS) and Standard Chartered.

Sir Richard, CBI director general between 2006 and 2011, is also a former editor of the Financial Times and an ex-member of the Bank of England's interest rate-setting Monetary Policy Committee.

'No bunch of patsies'

The reputation of the banks has been hit by scandals including the manipulation of the Libor interest rate and the mis-selling of payment protection insurance.

Sir Richard is expected to examine the need for new professional qualifications in the industry and consider how to raise standards of behaviour and restore trust.

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."

Speaking later on BBC Radio 4's Today programme, Sir Richard said he would spend the coming months deciding how the new body would operate and how board members would be appointed.

He had a "clean sheet of paper" he said, and stressed that the board's independence would be a priority.

"The blueprint will have to demonstrate that this outfit will not be a bunch of patsies," he said.

Sir Richard said the banking sector was "still bruised" following the financial crisis, and banks knew they would have to work hard to recapture public trust.

The Parliamentary Commission on Banking Standards was set up by Chancellor George Osborne in 2012 to report on professional standards and the culture of the sector.

CBI director general John Cridland welcomed Sir Richard's appointment, saying that restoring trust in the banking system was "absolutely fundamental to the future of the UK economy".

"[Richard's] 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," he said.

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