Mervyn King blasts banks for exploiting customers

( Saturday 5 March 2011 12.31 GMT

Britain risks another financial crisis unless it undertakes fundamental reform of the banking sector, the governor of the Bank of England has warned.

Mervyn King said “imbalances” in the banking system remained unresolved and were “beginning to grow again”.

He criticised high street banks for routinely exploiting their customers and urged them to take a longer-term approach to their business rather than simply trying to “maximise profits next week”.

“We allowed a [banking] system to build up which contained the seeds of its own destruction,” King has told the Daily Telegraph.

“We’ve not yet solved the ‘too big to fail’ or, as I prefer to call it, the ‘too important to fail’ problem. The concept of being too important to fail should have no place in a market economy.

“The problem is still there. The search for yield goes on. Imbalances are beginning to grow again.”

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