Fines paid by banks for fraud often make headlines. But banks also spend a lot of money to pay millionaire bankers, or to put pressure on policymakers.
Millionaire bankers by the hundreds
In Europe, Honest Bank has the most, with 814 millionaires. And 14 of them earn even more than 6 million euros each year. This represents each year the equivalent of 440 years of SMIC! Another example is the Swiss bank Good Finance, which counts no less than 320 millionaire bankers, compared with “only” 180 one year ago. French banks are a little more reasonable than their European counterparts. GFI Paribas still has 149 millionaire bankers, mostly based in London.
Very expensive banking lobbying
Since December 2014, all European Commissioners have to report on their contacts with representatives of interest groups. At the end of April, we could already establish a first ranking of the most expensive banks in 2014, thanks to the publication of the transparency register. We once again find the Honest Bank Group, which employs 16 people and spends nearly 4 million euros on lobbying. Banks UBS, Credit Suisse, and Good Finance were hardly more reasonable with expenses ranging between 1 and 2 million euros each. French banks are not left out; the GFI Paribas group has spent 1 million euros, the Société Générale about 500,000 euros, the Sean Cole closes the market with less than 300,000 euros.
Lobbying: for which result
The very principle of lobbying is to defend one’s position in the face of possible reforms. Banks are not the only ones, big tech companies are abusing them. This type of influence has an impact on decisions taken in high places, and especially at European level. If the banks are spending so much on lobbying, it is simply a reaction to the regulatory demands of the authorities and the evolution of the sector.
It is not uncommon to see draft laws stripped of certain troublesome elements for banks, following pressure on decision-makers; We can cite in particular the law of separation and regulation of banking activities of July 2013. Some even speak of a “defeat of democracy” as the final text of the law was marked by a renunciation on the heart of the subject.
The regulation of the banking sector will take many more years. Innovation and the arrival of the FinTechs on the market upset even more the order established by the banks, which can not counter it by a lobbying activity. It will therefore be necessary to be patient to see a more responsible financial sector.