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HBOS lost control

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Watching the BBC's Money Programme, they have just started a six-part series about the Credit Crash on Thursday nights.  The first episode focused upon HBOS and their issues. 

Fascinating programme that included an interview with Paul Moore, the Group Head of Risk for HBOS from 2002 to 2004.  This is the Paul Moore who reported to James Crosby.  Yes, the James Crosby who is now Deputy Chairman of the FSA, a Knight of the Realm and advising the Treasury on the mortgage crisis, who just happened to be in charge of reputation and risk management at the time.

Anyways, Paul said a few things that resonated with me, such as: "The retail bank was going at breakneck speed and an internal risk and compliance function feels like a man in a rowing boat trying to slow down an oil tanker."

This breakneck sales culture that ignored risks was picked up on by an FSA report in 2004 which asked for appropriate systems and controls to be put into place.

In a statement to the BBC this week, HBOS said that the 2004 review "highlighted a number of actions to improve overall systems and controls. Those actions were accepted by the business", and that "these reviews were shared with the FSA and the matter was then closed."


So that's that then?

Lloyds TSB?  Pardon?

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Chris M Skinner

Chris Skinner is best known as an independent commentator on the financial markets through his blog,, as author of the bestselling book Digital Bank, and Chair of the European networking forum the Financial Services Club. He has been voted one of the most influential people in banking by The Financial Brand (as well as one of the best blogs), a FinTech Titan (Next Bank), one of the Fintech Leaders you need to follow (City AM, Deluxe and Jax Finance), as well as one of the Top 40 most influential people in financial technology by the Wall Street Journal's Financial News. To learn more click here...

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