Big banks' bosses are crying anew about the policing of their industry, warning of 'regulatory fatigue', stifling uniformity and mounting compliance bills that could force small, under-resourced rivals into extinction.
Although the fresh laments come on the eve of several major regulatory initiatives and have an undeniably self-serving agenda, it would be wrong to dismiss them as displays of mere crocodile tears. Endangered choice aside, bank customers of the future may well suffer a range of unintended outcomes from the well-intentioned but onerous regulatory burden now being placed on lenders.
The latest warning of just such a scenario came in the annual 'banana skins' report by the influential Centre for the Study of Financial Innovation (CSFI) on the biggest risks facing bankers.
The 200 bankers, regulators and financial analysts polled for this week's report by the reputable City of London think-tank identified regulation as the greatest risk to the finance industry this year.
The result might appear a contradiction in terms, said CSFI co-director David Lascelles, in a commentary on the survey, since regulation was supposed to minimise risk, not create it.
But he noted that banking respondents thought otherwise, he said, and did so broadly for two reasons - the cost and workload required to ensure compliance and the threat of a grey uniformity being imposed across the entire industry.
