LONDON: Britain's banks are stuck on a cold "tundra" of flagging financial returns and failure to tackle structural problems like overpaid investment bankers and a lack of trust, a senior Bank of England policymaker said on Wednesday.
Martin Taylor, a member of the BoE's Financial Policy Committee which sets the regulatory tone for supervising banks, said lenders may be pursuing "unsustainably" high returns on equity of 10-15 percent at a time of low interest rates.
"We are in Siberia, where many people feel bankers belong," Taylor said in a speech.
The former chief executive of Barclays added that nearly nine years since the financial crisis started in 2007 banks are showing signs of recognising that their business models need fundamental change.
"The length of time it has taken for this penny to drop has proved very costly," Taylor said.
Behind the "improbably glossy surface", retail banks have still not rebuilt trust with customers. "Sermons won't fix it, and nor will advertising," Taylor said.
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