The fear index

Curiously – and I know it’s hard to believe – banks are not all bad.

In fact, we need them. Not just to store our money, lend us cash and keep businesses afloat.

We need them because they employ thousands of people and generate profits for shareholders who, in turn, pay the pensions of many private-sector workers.

Let’s not forget, either, that the average bank worker is not on a multi-million pound bonus, doesn’t fiddle the figures and can’t escape with the loot when things go wrong.

The average bank worker is as much of a victim of the crooks, charlatans and shysters in the international banking casino as the rest of us.

The other day, a Wolverhampton businessman told me the secret of his success: “I can honestly say our bank put the lights on in our business. We couldn’t have done it without them.”

Unfortunately, the men who try to fix the odds when they play billion-pound roulette with other people’s money work for the same company as the average girl on the till in the High Street.

So they all get tarred with the same brush. Some tar, some brush.

Barclays may have lost and regained its chairman, City toff Marcus Agius, within 24 hours and lost its chief executive, American wide-boy Bob Diamond, but that solves nothing.

Diamond Bob will walk away with most of his £105 million personal fortune intact, even if he has to give up some share options.

Mr Agius, likewise, has nothing to lose personally from the fact that he is now only temporarily in charge of what was once one of the world’s most respected banks. After all, he is married to a Rothschild.

There’s talk of criminal charges against a handful of traders who tried to fiddle Libor, the inter-bank lending rate. It won’t come to much.

That’s because, firstly, Barclays is one of maybe 20 banks involved in the scam. They’re just the first to hold their hands up to it.

Secondly, the authorities have a knack of losing prosecutions against this sort of white-collar crime. Even when they win, the cases drag on for years, cost millions and the world has moved on.

And, thirdly, there is so far – despite all the wailing and gnashing of teeth – little evidence the conspirators succeeded in fixing anything and, even if they did, that anybody lost money as a result.

There is also the small detail that the Bank of England may have encouraged the whole thing in a bid to make the disastrous credit crunch slightly less terrible.

It’s a merry-go-round at the top of these organisations. Everyone is chummy with everybody else. They give each other lucrative jobs. Nobody loses out.

It’s really a casino but they like to pretend it’s a gentlemen’s club.

The reason the banks had to be bailed out, the reason they can sell dodgy insurance policies to unsuspecting small businesses and the reason they can lie about Libor is simple: Casino bankers have nothing to fear.

What’s the worst possible thing that can happen to a banker who squanders a few billion quid or manipulates lending rates to make some easy money?

He loses his job. So what? By then he’s got his millions stashed away. He’s got his second home and his yacht.

He’s probably minimised his tax liabilities and he’s still got a pension that’s the envy of everyone except, perhaps, members of the medical profession.

Their pride might be hurt a bit. They may miss the adrenaline rush of gambling a few billions on the throw of an interest rate.

But there’s really no down-side for these people personally.

Their banks may go to hell in a handcart but so what? They’re alright Jack.

When we threw billions at Royal Bank of Scotland and Lloyd’s, the very least the Government should have done is disqualify the members of their boards from ever serving as company directors again.

It’s illegal to trade insolvently and, on the face of it, that’s exactly what they were doing.

A small trader who does so is routinely banned from being a director, often bankrupted and frequently prosecuted. Not a banker.

Apparently this is because, no matter how bad their debts, they weren’t insolvent for one simple reason – the taxpayer would always bail them out. 

There is, therefore, no personal responsibility. No risk. Just the potential for massive rewards.

The banking system needs radical reform. But it’s not about regulation and rules. That’s just shutting the stable door after the golden horse has bolted. 

Only when the top people can be humiliated, stripped of their assets and sent to jail will we have a properly regulated banking system.

A well-padded early retirement is no penalty at all. If there were real threats, if these gamblers could lose their money and their liberty, they might exercise a bit of caution.

Dozens of inquiries are now under way but we all know why the men in braces behave so wildly. They have nothing to lose and millions to gain.

They have no fear. Take away the safety net. Watch them fall.