UBS top banker admits banks were “too arrogant”

Banks were "too arrogant" and needed sweeping cultural changes, a top banker at UBS said yesterday as the Swiss bank was described by the incoming archbishop of Canterbury, Justin Welby, as a "corrupted organisation".

At a hearing of the banking standards commission, the bank's new head of investment banking, Andrea Orcel, admitted to MPs and peers that banks had become "too arrogant, too self-convinced" before the banking crisis that helped to expose the rigging of interbank lending rates. He was speaking at a hearing of the banking standard's commission. UBS was fined a record £940 million as a result of the scandal last month.

"I think the industry has to change," said Orcel, who joined UBS in July. He was dubbed the "Ronaldo of banking" by a commission member, and described as a "deal junkie" by another.

The commission is chaired by the Conservative MP Andrew Tyrie. Commission members were shocked by the bank's admission of sacking only 18 of the 40 individuals, who regulators said, knew about the Libor rigging. According to Tyrie, Libor rigging was "a shocker of enormous proportions".

Orcel had advised Royal Bank of Scotland on its ill-fated takeover of ABN Amro during his stint at Merrill Lynch, for which he is said to have been paid a £7.5 million fee. Orcel insisted that the staff involved in manipulating Libor had been "dismissed, penalised or reprimanded". According to UBS, 22 people still employed by the bank had been disciplined.

However, UBS is refusing to discipline traders who used chat rooms that gave clear details of their colleagues' plans to fix Libor interest rates, for which the bank paid $1.5 billion (£940 million) in fines.