Martin Vander Weyer Martin Vander Weyer

Running a bank’s tough. That’s no reason to start handing capital back

Also: Buybacks are becoming more popular with British companies — but at what cost?

A mixed bag of annual results from the big banks. RBS, still 73 per cent owned by the taxpayer, recorded a small profit for the first time since 2008 but took flak for a newly released report on the outrageous behaviour of its Global Restructuring Group, the team that mistreated struggling business customers in the post-crash phase. No wonder chief executive Ross McEwan looked tired, irritable and homesick for New Zealand.

Lloyds, having served its time in the sin bin alongside RBS, is now by contrast the sector’s comeback star, with profits up 24 per cent to £5.3 billon (despite another hefty charge for PPI mis-selling) and promises of more lending to start-ups. No wonder chief executive António Horta-Osório — whose pay last year rose to £6.4 million and whose health, like his bank’s, has fully recovered since the dark days of 2011 when he took leave suffering exhaustion — looked positively gleaming.

HSBC, meanwhile, reported handsome pre-tax profits of $17 billion, up from $7 billion in 2016, but still had skeletons rattling, including a potential $1.5 billion fine for alleged money laundering and other hanky-panky in its Swiss private bank. Retiring chief executive Stuart Gulliver looked less than triumphant, while markets wait to see whether his successor John Flint, HSBC’s former retail banking head, can complete a reputational clean-up.

Barclays, where the net result was a £1.9 billion loss after one-off hits from the sale of the bank’s African business, the impact of Trump’s tax reforms, loans to Carillion and PPI claims: chief executive Jes Staley, with little to show for his strategic thrust so far and a pending FCA inquiry into his attempt to unmask a whistleblower, would be best described as looking uncomfortable.

One thing common to all these results was that they had little impact on the banks’ share prices, which continue to languish far below pre-2008 levels.

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