The Financial Conduct Authority and the Prudential Regulation Authority have finally got around to publishing their reports into the collapse of HBOS.
The contents hardly come as any surprise given what we already knew about the flawed Business Model that had already caused a run on Northern Rock. However, what is surprising is that the level of hubris that infected those at the top of the organisation was even greater than one might have imagined. At paragraph 869 of the FCA Report we have the following:-
“HBOS Group’s entrepreneurial priority fed into the list of competencies that it used to appraise its executives. The list, headed “HBOS DNA”, provides some indication of the traits that were important to HBOS; risk consideration is conspicuously absent:-
There then follows a list of ten attributes including:-
………”Optimism –Believes the unbelievable and conveys to all around a real sense of heroic optimism.”
Anyone would think the Bank was being run by a bunch of Estate Agents!