Bank CEO: Stop bashing us

'Life is hard enough,' says the head of UBS, which took a taxpayer bailout, had a rogue-trading scandal and is being investigated for currency manipulation.

By MSN Money Partner Jan 27, 2014 3:18PM
Images: Bank Vault (© Radius Images/Jupiterimages)By David Enrich and Francesco Guerrera, The Wall Street Journal

Sergio Ermotti, chief executive of UBS AG (UBS), has a message for the many critics of the Swiss bank and the entire industry: Back off.

"Life is hard enough, and I think this constant lecturing on ethics and on integrity by many stakeholders is probably the most frustrating part of the equation. Because I don't think there are many people who are perfect," Ermotti said in an interview at the World Economic Forum in Davos, Switzerland. "We are far from being perfect. . . but it's not going to be very helpful to be constantly bashing banks."

Ermotti is saying what many bank executives are privately thinking. But at a time banks are held in low regard by many Europeans, few executives are willing to publicly give voice to such frustrations.

UBS has been on the receiving end of quite a lot of bashing, thanks to huge losses it suffered during and after the financial crisis; a taxpayer bailout; a rogue-trading scandal and an admittedly central role in the manipulation of benchmark interest rates.

While populist attacks on bankers have died down in the U.S., they remain widespread in Europe. In Switzerland and the European Union, politicians and regulators regularly lambaste bankers for their rich pay packages and are pushing to hold bank executives legally responsible for their employees' actions. 

At UBS' annual meeting last May, angry shareholders protested against management pay packages in the wake of a $2.7 billion loss. One investor held a collage that featured the phrase "Ripped Off!" in German and mimed an exaggerated shedding of tears.

The 53-year-old Ermotti, who became CEO in late 2011 after the abrupt resignation of the bank's previous boss, has been trying to clean things up at UBS. He has shrunk the bank's balance sheet and tried to reduce the importance of its loss-prone investment-banking arm. And he is trying to instill a new culture in the bank's roughly 60,000 employees around the world.

UBS, however, remains a lightning rod for controversy. The latest instance: The bank is under investigation by Swiss, British and U.S. authorities for its role in the potential manipulation of currencies. UBS has suspended at least one employee.

"It is frustrating to see these kinds of issues are popping up," Ermotti said of the currencies investigation. "We try to the extent possible to take the lessons learned from past issues" and use them to avoid future mistakes.

But Ermotti, a Swiss native who has spent his entire career in the banking industry, said he is growing frustrated with what he sees as some regulators, politicians, shareholders, clients, journalists and rival banks holding UBS to a higher standard than they hold themselves.

"When I look around, I don't think there are many banks that can come to us and say they are the example that should be followed," he said. Speaking of a broader group of industry "stakeholders," including regulators and politicians, Ermotti said: "None of them can be overly critical."

Ermotti's remarks are reminiscent of those made in the past by other bank executives about what they perceived as excessive banker bashing. Former Barclays PLC CEO Bob Diamond, for example, told British lawmakers in 2011 that "there was a period of remorse and apology for banks. That period needs to be over." The next year, Diamond was forced to resign after Barclays admitted trying to rig interest rates.

At the World Economic Forum last week, the banking industry's continuing behavioral problems were a hot topic. In a private meeting held between bank CEOs and central bankers and regulators Friday, several participants pointed to banks' "conduct" issues as undermining efforts to rebuild public and investor confidence in the industry, according to executives and central bankers who were there.

"Whether or not [the industry] thrives will rest on the efforts of individuals and organizations to re-establish the system's reputation for integrity," Bank of England Gov. Mark Carney said in a speech in Davos.

Ermotti, who in the past also has spoken out against banker bashing, said in the interview that most of the bad behavior that has landed UBS and others in hot water was caused by small groups of rogue employees and doesn't reflect broader cultural problems in the industry. "It's not because you're a banker that you're a criminal," he said.

Ermotti also disputed the widely held notion that the woes of Europe's banks have hurt the continent's economy.

"Many people blame banks" for Europe's economic troubles, he said. "It's just an absurd concept. We all see that by now it's a little more than a financial crisis. In Europe, who thinks banks are responsible" for the underlying state of the economy?

The banking industry, he added, "is an easy target."

—Andrew Morse contributed to this article.

More from The Wall Street Journal

Tags: UBS
Jan 27, 2014 3:46PM
they are far from being perfect is an understatement. the truth of it is that they are perfect crooks who committed the perfect crime:  bringing the world economy to it's knees and ruining countless lives and completely getting off scott free for it all.
Jan 27, 2014 4:11PM
Sorry Sergio, but when you make the money you do you'rd held to a higher standard. Maybe when you and your colleague's start taking accountability for the monumental mistakes you make then maybe you will get a little more sympathy from those that have to pay for your mistakes.
Read the CEO is hoping people will forget what a crook he is so he can go back to stealing trillions of dollars for himself and his super rich buddies that allowed him to steal lots of the world's wealth.

How do you think 85 men now control more wealth than 3.5 billion people.

THEY STOLE IT!!!!!!!!!!!! I want my money back Mr. CEO guy...............

Jan 27, 2014 4:40PM

You know, one of the concepts my parents taught me was "With privilege comes responsibility". The privilege of the office of CEO and the ability to make decisions and shape policy and enforce standards of conduct and honesty were yours, and you chose to t make use of the privilege of the power and the pay, but took no responsibility for your dishonesty and mismanagement. Not just you, you  have other people to keep you company who are equally guilty and responsible. You think that the public spends too much time bashing banks? I think they should spend more time seeking out alternatives to banks.

Jan 27, 2014 4:51PM
If you are responsible for other people's money, you damned well better have integrity and take the lectures until you develop some integrity!! Sanctimonious ****!!
Jan 27, 2014 5:00PM
The man is narcisstic with a huge ego.  To have the guts to say stop bashing the Banks when the big boy Banks have stolen billions and created economic collapse in many parts of the world takes a lot of guts.  Just look at what B of A and Chase have done in the US with not one of their executives going to jail.   I believe the term is hubris for what these bankers think of themselves.
Jan 27, 2014 5:15PM
These are the guys that make tens of millions and pay their tellers $8.50 an hour?  Stuff it, Sergio.  You have to love Davos, the annual gathering of the rich telling us to keep quiet and back off.
Jan 27, 2014 4:09PM
the banksters are the bigger terrorists.
Jan 27, 2014 4:57PM
When I think of banking/investment banking executives I think corruption, collusion, money laundering, market manipulation and criminal activities. Did I omit anything?
Jan 27, 2014 5:02PM
I thought it must be a joke when I saw the title of the article. Just affirms how far removed from the real life, of most people, the CEO Class and the super wealthy have become... Their glasses have some pretty funky tint. To see how these clowns bounce from "private" to government positions is pretty laughable. The ethics of the super wealthy are a joke, they don't care how others live as long as they can keep getting away theft. How many bankers went to jail? LMAO 
Jan 27, 2014 4:33PM
I bank at a credit union. Stuff the banks.
Jan 27, 2014 5:14PM
"Leave us alone!"...there is still more money to be stolen.
Jan 27, 2014 4:56PM

Banks highly regulate/scrutinize their employees yet find disdain when put under the microscope themselves.

If I'm questioning anybody, it's those holding my $$$.

Jan 27, 2014 5:12PM
As a small business owner, I've found that banks in general have become so detached from what their original roles in the daily lives of businesses and individuals originally were, that they have become a negative, instead of a positive factor, in the American economic world..... they are a necessary evil.  They have become just devoid of common sense, and look to analysts to give them all of their answers, or look to for individuals and business to fit into one of their business models in order to get approved for loans and credit...... it does not need to be that complicated of a process.  I am very unhappy with that industry as a whole..... very unhappy.  
Jan 27, 2014 5:11PM
In some countries, these Crooks would be Stoned to Death, yet this fool has the nerve to say leave me alone?

"Life is hard enough, and I think this constant lecturing on ethics and on integrity by many stakeholders is probably the most frustrating part of the equation. Because I don't think there are many people who are perfect," Ermotti said"

This from a group of folks that had to be Shamed into ending Payday type Loan Shark Loans years after the FACT. This from a Group of Folks that are still Reaping the Rewards from literally destroying the Global Economy. The Banks are now even far Bigger than before the Great Recession. They still are Too Big to Fail, Too Big To Jail, yet they are still whining.

Jan 27, 2014 5:56PM
Hmm... Lets see lousy interest rates, we bailed you all out, your doing it again.  You know what you can do with your plea there Serge.  You deserve much more bashing than all of you are getting seems the US has laid off and that's a shame they are still ruining lives and taking our money one way or another.  Both banks and wall street should continue to be bashed they both suck.  Not to mention these CEO take home salaries.
Jan 27, 2014 5:10PM
Only when bank policies and actions are along the guides of complete integrity and honesty, only when CEO's and other bank executives bonuses are in par with the performance of the banks earnings, only when the bank distributes its gains equitable amongst employees and to its customers, only when banks operate for the benefit of all equally and fairly will we "the public" recognize and acknowledge that you are contributing to the welfare of society and not raping and pillaging at the expense of those less able to withstand the cruel economic sanctions for which you are actively participating. If you want our blessings and respect, it's time banks re-evaluate business practices and enter the new world of doing what's right and not victimizing the public in order to line your pockets that are already bulging with monetary gains. We do not feel sorry for you!
Jan 27, 2014 4:50PM
Chill out bank dude- go home, open a bottle of Dom Perignon and admire all those artworks you acquired from Jews fleeing the Nazis.
Jan 27, 2014 4:58PM
Jan 27, 2014 4:53PM
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