Commission culture at banks

The incoming chairman of Barclays has told MPs that banks must jettison the "commission culture" which has led to sales of inappropriate products.

Barclays and other banks are beset by scandals including the mis-selling of Payment Protection Insurance, sales of unsuitable add-ons to small business accounts and the attempted rigging of a key market interest rate called LIBOR.

Sir David Walker, who will occupy the chairman's seat at Barclays from November, said that bankers "must get away from remuneration linked to revenue sales" and that boardrooms must be readier to intervene to prevent managers from putting their banks' reputations at risk.

He told the committee that "making quick returns...overtook old fashioned concerns about standards" and he lamented the fact that cashiers in branches had been tainted because of the way pay and commissions were structured.

Sir David is giving evidence to the Banking Standards Committee, set up to report on the industry in the wake of the LIBOR affair.