LONDON (Reuters) – Bank of England governor Mervyn King took a swipe at bankers on Sunday, saying they should take a lesson about fair play from the Olympic Games, which have shown that money is not the only motivator for success.
King, who has previously criticised banks for excessive pay and shoddy customer treatment, also called for international cooperation to ease a global economic crisis in a column in the Mail on Sunday newspaper on the final day of the London Games.
“As recent scandals have shown, banks could learn a thing or two about fair play from the Olympic movement,” said King, a keen sports fan who is fond of using sporting analogies to clarify economic policy.
The reputation of banks is at a low after string of scandals over rate-rigging, mis-selling to customers and high levels of pay at a time when many workers are suffering wage freezes and job insecurity.
Britain’s Barclays bank (BARC.L) was fined $453 million in June for manipulating Libor interbank lending rates in a scandal that has embroiled banks on both sides of the Atlantic.
British banks have also set aside billions of pounds to compensate customers mis-sold payment insurance products, and face further costs over the mis-sale of interest rate hedging.
“The financial sector has done us all a disservice in promoting the belief that massive financial compensation is necessary to motivate individuals,” King said.
The thousands of Britons who had volunteered as guides and helpers at the Games showed that “motivation is more than mere money,” he added.
In a broader message aimed at policy makers worldwide, he said the Games showed the need for teamwork and how sport could generate trust and understanding.
“In the midst of the most difficult economic times for several generations, the need for countries to trust each other and work together is more important than ever.
“The origins of the financial crisis were global. So too must be its solution,” he said.
King said Britain’s economy was “slowly healing”, and urged patience ahead of an eventual turnaround.
“If we have learnt anything from the past fortnight, it is that commitment and hard work over a long period are necessary for eventual success,” he said.
“Conditions are in place for recovery, and the Bank of England is, and will carry on, doing all we can to bring it about,” he said.
The Bank of England has kept interest rates at a record 0.5 percent low since March 2009 and by November will have spent 375 billion pounds buying government bonds to lower big companies’ capital costs.
The Labour opposition and some economists want Prime Minister David Cameron’s Conservative-led government to play its part by easing a deficit-cutting austerity programme they blame for putting a lid on growth.
Britain’s economy is struggling to recover from the 2007-08 financial crisis, tipping into its second recession in four years at the end of 2011.
The Bank of England slashed its forecasts last week and believes there will be no growth in Britain’s economy this year.
(Reporting by Tim Castle; Editing by Alison Birrane)
