The financial crisis is getting personal, with the press beginning to single out individual bankers...
HBOS’s aggressive corporate banking division was revealed to have been at the heart of the £10 billion shock loss announced by Lloyds Banking Group yesterday. Lloyds Banking Group issued a warning that HBOS, the ailing bank it has taken over, made a whopping £7 billion of corporate losses last year after making bad bets on business lending.
Lloyds admitted that HBOS’s corporate division, which was run by Peter Cummings — the highest-paid executive at the bank — has had to write off £7 billion of bad loans, far more than HBOS’s management ever admitted. Mr Cummings is understood to have left in early January with a payoff thought to be about £660,000 and £6 million of pension entitlements.
Yesterday's star, becomes today's scapegoat. Lets hope that Mr. Cummings doesn't become a sponge to soak up all the blame. There are plenty of other culprits out there, hiding behind Cummings, Crosby and the other gamblers from HBOS.