Charlotte Hogg, chief operating officer of the Bank of England, gives career advice to London school pupils
Being seated inside the hallowed court room of the Bank of England was the last place 14-year-old school pupil Rachel Natoajeva thought she would end up when she signed up for an event to meet “inspirational women”.
“You can’t see someone from Lewisham coming here,” she explains, as oil paintings of be-wigged former governors stare down upon us from the walls. One of 120 school girls from London state schools aged between 13 and 17 selected to attend a “speed networking” event at the Bank with City career women, surprisingly few said they wanted to be bankers or work in finance. They came here, one girl explains, to meet “women who are successful”. Read more
Mark Carney © Photo by Chris Watt – WPA Pool /Getty Images
Mark Carney, governor of the Bank of England, would not win a popularity contest among directors of banks at the moment. Yet he and the Bank are taking a stance on individual responsibility that most people think is long overdue. Read more
Few things are as alluring as optimism and Mark Carney sees the banking glass as half-full. The Bank of England governor has arrived from Canada with a dose of can-do spirit, casting off the pessimism of Mervyn King, his predecessor.
Adam Posen’s attack on the management and culture of the Bank of England may be the strongest yet, but it is by no means the first – and won’t be the last – criticism of a persistent and dismaying lack of robust governance at the UK central bank.
What is astonishing is that despite countless warnings – three independent reviews, several newspaper editorials and sundry MPs’ warnings – the central charge that the governor is over-mighty and under-governed still stands. Read more
Having become accustomed over the years to the calm, soothing, “don’t panic” talk of financial regulators, it was a shock to read Andrew Bailey, the senior UK banking supervisor, bluntly describe banks’ risk models for commercial real estate as “bogus”.
Mr Bailey clearly has very little, if any, time for banks’ internal risk models, which calculate how much they might lose in stressed market conditions, and therefore how much they need to put aside in capital.
As Brooke Masters reports:
After two decades of working with failed and failing institutions including Barings, HBOS and Royal Bank of Scotland, he was openly sceptical of bankers’ ability to police themselves.
Their commercial real estate risk models are “bogus”, he said, and their internal stress tests “are not stress at all, they’re mild, it’s a failure of imagination”. As a result, banks “never should have been allowed” to use their own models to determine capital requirements as currently permitted under the Basel rules.