The View | Banking - the ultimate dead-end job

The transformation of banks from proprietary trading machines to pure service entities is not as straightforward as changing regulations.

Increasing interference and the desire of governments to control how and what bankers are paid mean banks may not need terribly smart people to run them. So who wants to work and lead a dumbed-down organisation? And are risk and talent so easy to dial down to a controllable level, like a volume control?

There was a time when investment bankers were opposed to making morality judgments in front of clients. As one joked, "it's OK to tell your mainland clients that their credit ratings aren't affected by their lack of morals". Now bankers' morals are being judged or embarrassed regularly in media. And it is affecting their future. Senior bankers already report that their teams are reluctant to execute some trades and take on business or clients because it is simply too much compliance trouble.

Rather than nationalise the banking system, which would promote even more hazardous attitudes towards risk, regulators are seeking to nationalise banking culture - to produce a hybrid of a profit (and risk)-oriented enterprise run by well-behaved, conformist managers.

The intentions are dubious - to rein in all speculative risk-taking activities in a risk-taking industry by restricting its rewards. Surely, this will backfire on everyone, especially the markets.

Antipathy and contempt still exist between regulators and bankers since they were forced to work together during the financial crisis.