In this anxious lull between the Spanish bailout and the Greek election result, the most potent symbol of the continent’s perilous financial state is Madrid’s Puerta de Europa, or ‘Gateway to Europe’. That happens to be the name of the twin skyscrapers that lean towards each other at a sickening angle over the shoulders of television reporters tasked with trying to explain whether last weekend’s €100 billion deal was a triumph of robust collective action or — as markets seem to be signalling — another domino-fall in the inevitable disintegration of the single currency.
Conceived in the late 1980s as a showpiece of Spain’s real-estate-fuelled new prosperity, the Madrid project was left unfinished after the collapse of the developer, Grupo Torras, amid accusations of massive fraud involving sovereign funds from Kuwait. A Spanish official memorably remarked in 1993, when Spain had plunged deep into recession, that even if the towers were completed, ‘What the hell would you do with them?’ But they were built out anyway, and one of them eventually became the headquarters of Bankia, a savings-bank group that was ruined by bad mortgage lending at cheap euro rates. Bankia duly collected a €19 billion bailout of its own last month.
So the leaning-tower vista tells the whole story of Spain’s double boom and bust, and we can only look at it as we look at the euro: why did anyone think this was an elegant design in the first place, and can anything save it if its foundations are unsound? Meanwhile, Spanish prime minister Mariano Rajoy ran into flak for refusing to acknowledge the bailout, in which eight banks were nationalised, as a ‘rescue’, referring to it only as ‘what happened yesterday’. As the euro tragedy continues to unfold, I fear that’s exactly how it will come to be seen.
When we’re worrying about the very survival of the banking system, the issue of how politely banks treat us seems relatively trivial. Now is not the time to turn this column into a print version of You and Yours, Radio 4’s achingly tedious consumer affairs slot. Nevertheless, responses to my call for readers’ experience of customer disservice by high-street banks have been coming at me like flood waters across a Welsh caravan site. A common theme is the crass response to the rise of identity theft: unable to stop the billions of fraudulent ‘phishing’ emails issued daily in their names, banks turn instead on their most loyal account-holders. Thus Barclays refuses to deal with an 86-year-old widow, a customer of 50 years’ standing, who has forgotten her pin and doesn’t have a passport, while Halifax tells an 84-year-old immobilised by a broken leg that she must attend in person if she wants to move her savings to a higher interest account — and won’t send a staff member to speak to her in a car outside, to save her the effort of staggering to the counter.
As for the quality of communication, one complaint is typical of many: ‘We wrote, phoned, emailed etc. and were ignored. We couldn’t make an appointment because we couldn’t find a responsible person to speak to. We went to the bank but the person concerned was never there. Even recorded delivery letters went unanswered.’ Meanwhile, I’m pleased to see Marks & Spencer moving into banking with a plan to open branches in 50 stores and a promise from chief executive Marc Bolland that the new offering will ‘be built on M&S values… delivering the exceptional service that sets us apart’. For a retailer up against so much smart competition in its clothing and food ranges, it must be a relief to find a sector where the benchmark is so shamefully low. Keep the anecdotes coming, to email@example.com.
Never coming back
‘This place is crazy, I’m never coming here again.’ That — so he once told me — is what BP chief executive Bob Dudley muttered to himself after his first posting to Russia in the mid-1990s, as an Amoco executive trying to negotiate a joint venture with Yukos, the oil group controlled by the now imprisoned oligarch Mikhail Khodorkovsky. That sentiment must have been strongly reinforced when Dudley had to leave Russia under sustained harassment by local partners during his presidency of TNK-BP, the Siberian operation in which BP now looks set to sell its 50 per cent stake to an unnamed Russian bidder.
Having also failed in an attempt to link up with state-owned energy giant Rosneft, Dudley must be personally relieved to wave farewell to a place where, even by big-oil standards, business is so politicised and gangsterish. But he is also waving goodbye to a huge investment of resources and a rich income stream; and even with a better-than-expected settlement for the 2010 Gulf of Mexico disaster in prospect, BP is left looking like a company that has lost its strategic thrust and is ripe for break-up or takeover. In a couple of years, there may not be a BP left for oligarchs anywhere to kick around.
Money brings a Curse
The highlight of my Hay Festival debut was a contribution from an audience member, Sam Kenrick, who brought along some poems by his great-aunt Sophie — wife of Gerard Lee Bevan, the 1920s City fraudster who is the subject of my book Fortune’s Spear. I was familiar with Sophie’s fierce Edwardian tracts in favour of eugenics and Empire, but I didn’t know she could also turn her hand to a rather clunking sonnet. Her husband, an accomplished poet himself when he wasn’t busy falsifying company accounts and chasing showgirls, must have winced at one of Sophie’s called ‘Money: In the City’ — though it would have pleased last winter’s Occupy protesters outside St Paul’s:
‘Men with each other vie/ Amassing Coin… The Means towards End becomes the End itself/ And loses virtuous character thereby…/ So he with Much would ever More possess…/ And Money brings a Curse where it should bless.’