Archbishops attack finance chiefs

Sep 25 2008

The bankers and traders responsible for the recent financial crisis have come under fire from the two most senior clerics in the Church of England.

Archbishop of Canterbury Dr Rowan Williams called for fresh scrutiny and regulation of the financial world, arguing that Governments should not lose their nerve when deciding when to intervene.

Archbishop of York Dr John Sentamu, meanwhile, branded the traders who cashed in on falling share prices in troubled bank HBOS as "bank robbers" and "asset strippers".

In a wide-ranging and critical speech, Dr Sentamu spoke of an "Alice in Wonderland" market, in which "the share value of a bank is no longer dependent on the strength of its performance, but rather on the willingness of the Government to bail it out".

Speaking at the Worshipful Company of International Bankers' annual dinner on Wednesday night, Dr Sentamu said: "To a bystander like me, those who made £190 million deliberately underselling the shares of HBOS, in spite of a very strong capital base, and drove it into the arms of Lloyds TSB, are clearly bank robbers and asset strippers."

Writing in The Spectator, the Archbishop of Canterbury said: "It is no use pretending that the financial world can maintain indefinitely the degree of exemption from scrutiny and regulation that it has got used to."

Dr Williams also criticised the financial world as being detached from reality.

The practice of short-selling, in which a trader or fund sells borrowed shares, gambling on a fall in price which would allow them to buy the shares back more cheaply, and so make a profit on the loss, has been widely criticised in the wake of the collapse of US bank Lehman Brothers, and the rescue of HBOS by Lloyds TSB.

Sharp falls in the price of shares in banks have been blamed on short-selling by speculators hoping to drive the prices down further. A temporary ban was introduced on the practice by City watchdog the Financial Services Authority last week.

Dr Sentamu also spoke of the contrast between the bail-outs being given to beleaguered investment banks, and the lack of funding for the United Nations Millennium Development Goals being discussed in New York.