A REVIEW into Britain’s banking culture has been ditched by the UK’s financial watchdog only months after its launch, in the latest sign that years of ‘banker bashing’ is coming to an end.

The Financial Conduct Authority has abandoned its assessment of culture at retail and wholesale banks operating in the UK, saying each company is unique and cannot be easily compared, according to people familiar with the situation.

The move to scrap the review comes after Martin Wheatley, the watchdog’s chief executive, was forced out by the Treasury in the summer and reflects a more positive tone towards the City of London following the Conservative party’s election victory.

Banking culture has come under fire since the financial crisis over foreign exchange and Libor rate-rigging scandals that have led to multibillion pound fines. Misconduct involving consumers, such as the mis-selling of payment protection insurance, have also seen banks earmark more than £26bn in charges.

‘Cultural problems were fundamental to the financial crisis, and remain fundamental now. Lessons haven’t been learnt’

Mark Garnier, a Conservative MP and member of the Treasury committee, told the Financial Times that it was ‘disappointing’ that the watchdog had stopped its review so early.

“I hope this is a delay rather than a cancellation, because consumers need to know that an independent regulator is happy overall with bank standards,” he said.

Labour MP John Mann said it was ‘unacceptable’ that the review had been dropped. “As far as we know, the culture hasn’t changed yet - that’s very clear to people. Cultural problems were fundamental to the financial crisis, and remain fundamental now. Lessons haven’t been learnt,” he said.

The watchdog’s review formed an integral part of the strategy it laid out this year to parliament, business and consumers on how it would regulate financial services. It focused on a range of issues such as bankers’ pay and how concerns were dealt with.

An industry-wide board was created in the UK last year to promote high standards in the banking sector. Dame Colette Bowe, chair of the Banking Standards Board, has previously told the FT that ‘people have lost trust in banking’ after a string of scandals.

Mr Garnier said the FCA’s review could have ‘marked the homework’ of the banking board to gauge its progress.

The FCA said: “A focus on the culture in financial services firms remains a priority for the FCA.”

Published in Dawn, Business & Finance weekly, January 4th, 2016