DAVOS, Switzerland – If there is one place bankers should be able to let down their guard a little, you would think it would be at the World Economic Forum in Davos, an exclusive gathering of 2,500 of the globe’s financial and corporate elite.
Yet even here top banking executives found themselves on the defensive.
It’s a reflection of how big banks – blamed by some politicians and the public for the 2007 financial crisis and the resulting recession – are still grappling with pressure from recent scandals and moves toward increasingly complex regulation.
During a panel discussion on global finance at the forum, JPMorgan Chase CEO Jamie Dimon criticized the huge misinformation about the risks actually posed by banks.
He and other top bankers at the discussion, including UBS chairman Axel Weber, found themselves stressing that banks play an essential role in making economies grow – by lending to businesses so they can invest and expand.
Banks continue to lend and grow and expand, finance is a critical part of how the economy is run, he said at an all-star panel where he was challenged both by a top International Monetary Fund official and a hedge fund manager, whose firm is a client of Dimon’s bank.
Everyone I know is trying to do a very good job for their clients, Dimon said.
There have been plenty of negative headlines and investigations over the last year that show banking in a far harsher light: several top banks are under investigation for rigging key interest rates, HSBC has been fined for allowing money-laundering and Standard Chartered has been penalized for dealing with Iran.
Even Dimon’s own bank has suffered an embarrassing $6 billion trading loss on complex derivatives.