British Bankers’ Association chief executive Anthony Browne was more pleased than most to hear the surprise choice of next Bank of England governor.
Bank of Canada governor Mark Carney, set to take over next year, is married to a British woman while the British Browne is married to a Canadian. His wife and two children are Canadian citizens, leaving him the only member of his family without a Canadian passport.
He says: “I’m all in favour of Canada. When Carney was appointed I sent him a congratulatory note saying how much I support UK-Canadian relations.”
Browne’s Canadian links suit a career that has been international in scope, including spells reporting on the war in Iraq as a Times journalist and as a correspondent in Brussels.
After studying maths at university he spent 20 years working as a journalist for the BBC, The Observer and The Times, covering a variety of topics including a spell as health editor of The Observer. But his main focus was business and economics, culminating in the role of chief political correspondent at The Times.
He then left journalism to head up free market think-tank Policy Exchange, a breeding ground for advisers to Conservative politicians. Earlier this month its director Neil O’Brien left to become an adviser to chancellor George Osborne and will author the next Tory election manifesto.
And so it proved for Browne too, who received a call from newly elected Mayor of London Boris Johnson in 2008 to head his business and economics team. He also led a Johnson campaign to promote financial services and helped set up promotional body TheCityUK.
Browne also authored Johnson’s 2012 re-election manifesto, endorsed by the public with the mayor’s election to a second term in May.
He briefly worked for Morgan Stanley as head of government relations with Europe, the Middle East and Africa before the BBA job became available.
Browne was unveiled as Angela Knight’s replacement as BBA chief executive in June, just two weeks before the Libor scandal broke and Barclays received a record £59.5m FSA fine.
With allegations of the misselling of interest rate swaps still being investigated and the creation of the Parliamentary Commission on Banking Standards he had his hands full when he formally started in September.
He told friends at the time that the job was like going “out of the frying pan and into the erupting volcano” and when he joked with Knight, that “the only way is up” she gloomily replied that the industry has been thinking that for years, only to head further down.
But Browne really believes this is a turning point and says the big banks and senior management are willing to do whatever it takes to rebuild trust and confidence in the sector.
The BBA is still the administrator of Libor, but the reforms laid out by FCA chief executive designate Martin Wheatley will soon put an end to that.
Browne says: “We basically made those recommendations to Wheatley. We fully welcome it. Overseeing the transition of Libor to a new administrator is my top priority.”
Browne admits the Libor scandal has been a “big knock” to the banking system and London’s global reputation.
He adds: “There is no point pretending it has not been and the banks recognise it. The only good thing to come out of the Libor scandal is that all the banks at the very highest level know they have to do whatever it takes to restore trust and confidence.
“It might mean doing things that are slightly uncomfortable, but they are prepared to do it. My main mission is to restore trust in the banking sector to bring banking back as a normal sector of the economy that politicians feel they can say nice things about.”
That point seemed a long way off when Osborne increased the bank levy in the Autumn Statement to deny banks the benefit of a 2014 corporation tax cut.
Browne says: “It is unfortunate and we need to stop this banker-bashing. It is one part of the statement I take exception to – it was unnecessary to indulge in that.”
One idea to rebuild trust is the creation of an independent banking standards board and register of bankers, similar to the teaching and medical professions where misbehaving members can be struck off.
Since its conference last month the BBA has been working out the details with KPMG and aims to present its plans to the Parliamentary Commission on Banking Standards in the new year.
Part of rebuilding trust is addressing the misselling scandals that have dogged the industry and its balance sheets in recent years.
The FSA is cracking down on bank sales incentives and the culture of pushing products, leading to an investigation of Lloyds Banking Group. This has led Lloyds, Barclays and the Co-operative Bank to pilot incentive schemes based on customer service targets rather than sales.
Browne says: “We have a zero tolerance stance on misselling. Banks should not engage in practices that encourage or lead to misselling. To the extent that the rewards regime was responsible for misselling, it clearly has to be tackled.
“Banks have all moved to remuneration schemes that are more balanced towards customer service or looking at things more holistically. I would not go so far – and neither do the regulators – as to say that all performance-related pay is a bad thing, because rewarding performance can help customers.”
But Browne believes there is too much regulatory focus on misselling and says the RDR is harming access to markets and products in financial services by restricting access to advice.
He says: “The fundamental problem is the unintended consequences involved, and a large section of the market will no longer have access to financial advice. Affluent customers will be able to pay a fee, but huge chucks of British society won’t.
“Banks are pulling out of advice in their branches as it is no longer viable and it means many won’t get advice. That is a problem.”
Browne believes the RDR reflects a wider regulatory problem – focusing solely on reduced risk could hit customer choice.
He highlights interest-only mortgages as an area where banks are running scared because of potential regulatory action. He says the retrospective action taken over PPI misselling has had a big effect on innovation and risk-taking.
Browne concludes: “If the banking system is under the cosh so much it is frightened to develop new products or sell existing products, that is not a healthy financial system.”
Lives: North London
Education: Cambridge University, mathematics degree.
Career: 2012-present, BBA chief executive; Morgan Stanley, responsible for external engagement on political and regulatory issues with government bodies for Europe, Middle East and Africa; mayoral policy director for economic development for Boris Johnson, the Mayor of London; Policy Exchange director; television and newspaper journalist, with roles including economics correspondent and deputy business editor of The Observer, Brussels correspondent and chief political correspondent of The Times and economics correspondent at the BBC.
Likes: Climbing high mountains, entertaining friends. Not at the same time usually.
Dislikes: Strictly Come Dancing.
Drives: Vauxhall Zafira, but the kids have launched a campaign to get a new car. Any suggestions?
Book: 100 Years of Solitude; Brewster’s Dictionary of Phrase and Fable
Films: Anything by James Cameron or Werner Herzog
Album: Jesus Christ Superstar (it’s back in!)
Career Ambition: Running the BBA
Life ambition: To have no regrets on my deathbed
If I wasn’t doing this I would be… well, I was a journalist