Kleinwort boss slams politicians

POLITICIANS have been accused of “grand-standing” over calls for former Royal Bank of Scotland chief Sir Fred Goodwin to hand back his £703,000 a year pension.

Robert Taylor, chief executive of private bank Kleinwort Benson, said there was “an element of a witch hunt” against Sir Fred and other bankers who many people have blamed for causing the financial crisis.

Mr Taylor said he feared that the focus on leading bankers who had become “cannon fodder” for many commentators was detracting from dealing with ways to come out of the recession. Mr Taylor, who was speaking to TheBusinessDesk.com said: “I can understand why people think it’s too much (Sir Fred’s pension) when it was involving a failed bank.

“But for me the politicians have never been in these employment situations themselves.” 

Wealth manager Kleinwort Benson opened an office in Manchester in 2007 as part of its strategy to get closer to its clients and the financial and business communities in which they live and work.

Mr Taylor, a former managing director of SG Hambros Bank & Trust (London) and former head of private banking at Coutts & Co, said as with other banks, Kleinwort Benson was aiming to improve profitability.

“The world has changed since we opened our Manchester office”, he said. “We have to understand who our market is and where it is and what we need is a platform to go forward. But we’re no different from any other banks out there.

“It’s a very different type of recession. The difference to previous recessions is that the financial services and banking industries have found themselves almost bankrupt. Capital has been wiped out by write-downs.”

Mr Taylor, who said cash was still king for investors, said Kleinwort Benson’s clients were being more careful with their assets but he said he was worried that some clients were “yield hunting” – looking for high levels of interest on their investments.

But he said he didn’t think clients fully understood the quality of credit they were buying into and he said many were, perhaps understandably, sticking to their poor performing investments rather than taking on advice.

“Clients have been hunting for yields and not hunting for safety,” said Mr Taylor who said it was important to win back public trust and confidence in the banking sector.

“But the opportunities are out there and at some point it will take off.”

He said he was concerned that there was no “end game” fom political leaders about how to come out of the recession.