Britain watches bankers grilled over credit crunch

February 10th, 2009 - 7:51 pm ICT by IANS  

Gordon BrownLondon, Feb 10 (IANS) Senior British bankers apologised for their role in Britain’s economic crisis as Members of Parliament Tuesday began grilling banking figures in a televised inquiry.

The inquiry by the Treasury Select Committee was launched amid mounting anger in Britain over bankers’ alleged role in exacerbating the economic downturn while continuing to pay themselves hefty bonuses and refusing to lend to small businesses.

Former HBOS chairman Dennis Stevenson told the hearing, televised live by BBC and accessible on the Internet, that he and former chief executive Andy Hornby were “profoundly sorry”.

Appearing before the hearing, which is expected to be unsparing, RBS chief executive Fred Goodwin added: “I apologised in full and I’m happy to do so again.”

Stevenson said: “We are profoundly and, I think I would say, unreservedly sorry at the turn of events. All of us have lost a great deal of money, including of course a great number of our colleagues, and we are very sorry for that.”

Prime Minister Gordon Brown has called for a cap on bonuses amid reports that executives of the two banks that are now being run with taxpayers’ money were still paying themselves hefty bonuses.

London Mayor Boris Johnson, who belongs to the opposition Conservative Party, says bankers should donate their bonuses to charities.

At one point, a committee member asked a senior banker if he had sought any legal advice over “criminal negligence”.

However, the Labour government has also been criticised for its soft regulation approach, which critics say allowed bankers to keep making unsustainable loans throughout a 15-year period of economic boom.

Hornby told the committee: “We’re very sorry what’s happened at HBOS. It has affected shareholders, many of whom are colleagues, it’s affected communities in which we live and serve, it’s clearly affected taxpayers, and we are extremely sorry for the turn of events that’s brought it about.”

RBS is now 68 percent owned by the state and has been propped up with 20 billion pounds of public money.

HBOS was taken over by Lloyds TSB in a newly-formed Lloyds Banking Group last year following a 37 million pound-support in taxpayers’ cash.

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