"Sales culture" led to HBOS downfall according to former boss

A former senior director of banking giant HBOS has told how a “supermarket-type” sales culture had led to the near collapse of the bank.

Paul Moore, who was head of regulatory risk at the bank between 2002 and 2004, claimed that there were early concerns as to whether the business was “under control” as a “premier sales and marketing culture” was promoted throughout the company.

HBOS, the parent company of the Bank or Scotland and The Halifax, was recently taken over by rival bank Lloyds TSB in a move which effectively saved the group from collapse. At the time of the move, The Halifax was Britain’s biggest mortgage lender – a title that it still holds today.

Speaking to the BBC’s Money Programme, Moore said; "I think it was a major change – to change a bank from a fuddy-duddy, musty old place to a shopping centre, to a supermarket-type culture.

"The retail bank was going at breakneck speed and an internal risk and compliance function feels like a man in a rowing boat trying to slow down an oil tanker."

Moore, who was responsible for managing the company’s risk, claimed that even today, the bank was still had “a long way to go” before the current risk was balanced and suggested that a "broad ranging inquiry" is now required "to investigate in some detail all of the things that happened... because out of that will come lessons".