BANKING AND FINANCE | IN FOCUS
BANKING ON SUCCESS
BANKING AND FINANCE
Britain is one of the world’s leading centres of global financial services. Its success is vital – not just to the UK’s international standing but to ensure the financing needs of British businesses and households are met.
Fifty years ago high-street banking was the domain of bank managers like Captain Mainwaring from BBC TV’s Dad’s Army while the City of London was full of bowler hat-wearing, brolly-carrying stock market traders with titles such as “jobber” and “broker”. Fast-forward half a century and the majority
of people do their daily banking via their mobile phone while the City of London – which has extended east to Canary Wharf – hosts bankers from across the world carrying out complex financial transactions as well as share trading. While the deregulation under the “Big Bang”
shake-up of the City in 1986 and more recent financial innovations have made these advances possible and reduced costs for users, the industry is still reeling from the aftermath of the global financial crisis, which hit the UK severely.
HSBC’s Canary Wharf HQ (opposite) is a world away from Captain Mainwaring’s bank manager (right)
Despite the role of the capital, it is essential
to remember that banking and finance is much more than just a London industry. It employs more than 2 million people, of whom two thirds are based outside London. People across the UK work in the financial sector, from asset management and pensions in Scotland to general insurance and banking in the South West and the cluster of financial, accounting, legal and management consultancy firms in the North West.
FINANCING FOR GROWTH As one of the UK’s world-class sectors, the financial services industry contributes around 10 per cent to our GDP. It also plays a critical role in maintaining a healthy economy by supporting UK businesses. An efficient financial system is one that helps businesses to invest and grow. A sound financial system underpins
activity in every part of society. Retail finance offers day-to-day banking, savings and loans to individuals, families and small businesses. It also provides private pensions that play an increasingly large role in workers’ long-term savings, and a range of insurance products for people’s homes, cars and travel.
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Wholesale markets offer funding for larger
businesses to enable them to operate more efficiently and fund major transactions, as well as to help them manage their capital and reduce the risks of doing business. Companies that need to invest to grow their business are unlikely to be able to do so from their cash flow. The financial markets enable them to raise capital in the form of bank loans, or by issuing shares or bonds in »
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