Banking StandardsWritten evidence from the British Bankers’ Association


This submission provides information around the following written requests from the Commission:

The BBA’s annual income and, more specifically, what proportion of the BBA’s income comes from membership fees and what proportion comes from other sources.

How individual membership fees are determined and what proportion of membership income comes from top 5 payers and what proportion from top 10 payers.

Per the last audited statutory accounts for the year to 31 December 2011, BBA income totalled £10.0 million and fee income from full and associate members accounted for £6.6 million of this total. Therefore 66% of income came from membership fees and 34% from other sources.

In the same period, approximately 59% of member income came from the top 5 payers and 65% from the top 10 payers.

The British Bankers’ Association (“BBA”) is the leading association for UK banking and financial services representing members on the full range of UK and international banking issues. It represents over 150 banking members active in the UK, which are headquartered in 50 countries and have operations in 180 countries worldwide. All the major banking groups in the UK are members of our association as are large international EU banks, US and Canadian banks operating in the UK as well as a range of other banks from Asia, including China, the Middle East, Africa and South America.

A full list of BBA banking members and associate members is provided.

In our draft strategy, we commit to serving the entire cross-section of banks operating in the UK.

Much of the information in this document is available online:

Subscription Calculation

The methodology for calculating member subscriptions was agreed by the BBA Council in March 1997 and re-confirmed in 2005.

For members within banking groups, subscriptions are calculated on aggregated data relating to all banking entities within the group.

Subscriptions are paid on a stand-alone or banking group basis as appropriate.

Subscriptions are subject to a minimum

Subscriptions are based on three measures of ‘institutional size’:

No. of full-time equivalent staff in the UK

(reported by members to the BBA annually, as at June)

Sterling eligible liabilities held on the balance sheet of the member’s operational offices in the UK

(a measure of sterling resources as reported to the Bank of England monthly/quarterly and the basis of cash ratio deposits placed with the BoE)

Total foreign currency assets held on the balance sheet of the member’s operational offices in the UK

(as reported to the Bank of England monthly/quarterly)

Subscription amounts are calculated by multiplying each of the ‘size’ measures by variable weighting factors, subject to:

The contribution of the currency assets component not exceeding the sum of the staff and eligible liabilities components.

Minimum subscriptions level.

Weighting factors are determined in the proportions of 45% : 45% : 10% (staff : eligible liabilities : foreign currency assets)

New members are charged a pro-rata subscription relating to their joining date

Subscriptions charging in proportion to member size, according to recognised metrics (reported in part to an independent source), is equitable and transparent to our membership and produces a smooth spectrum of subscriptions. The calculation methodology forms part of the BBA’s annual financial review by external Auditors.

The BBA will be reviewing its membership subscription methodology during 2013 to come in for 2014.

BBA Member List1

ABC International Bank plc
Adam & Company Investment Management
Adam & Company plc
Ahli United Bank (UK) Plc
Allied Irish Bank (GB)/First Trust Bank (AIB Group (UK) plc)
Allied Irish Bank plc
Alpha Bank AE {Part of the Alpha Bank London Group}
Alpha Bank London Ltd {Part of the Alpha Bank London Group}
AMC Bank Ltd {Part of the Lloyds Banking Group}
ANZ Investment Bank
Arab National Bank
Arbuthnot Latham & Co Ltd
Arbuthnot Securities Ltd
Australia & New Zealand Banking Group Ltd
Banca Monte Dei Paschi di Siena SpA
Banco Bilbao Vizcaya Argentaria SA
Banco de Sabadell SA
Banco Santander Group
Bangkok Bank Public Company Ltd
Bank J. Safra (Gibraltar) Ltd
Bank Leumi (UK) plc
Bank of America NA
Bank of Baroda
Bank of Ceylon (UK) Ltd
Bank of China
Bank of Cyprus UK
Bank of India
Bank of Ireland
Bank of London and the Middle East
Bank of Montreal
Bank of Scotland plc {Part of the Lloyds Banking Group}
Barclays Bank Group
Blom Bank France (Formely Banque Banorabe)
BNP Paribas Group
British Arab Commercial Bank Plc
Brown Shipley & Co Ltd
Butterfield Private Bank
C Hoare & Co
CAF Bank Ltd
Cambridge & Counties Bank
Canadian Imperial Bank of Commerce
Canara Bank
Cater Allen Ltd {Part of the Banco Santander Group}
China Construction Bank (London) Limited
Citibank NA
Close Brothers Ltd
Clydesdale Bank plc
Commerzbank AG
Commonwealth Bank of Australia
Coutts & Co
Credit Agricole Corporate and Investment Bank (formerly Calyon)
Credit Industriel et Commercial
Credit Suisse Group
Crown Agents Bank Ltd
Cyprus Popular Bank Public Co Ltd
Danske Bank A/S
DB UK Bank Limited
Deutsche Bank AG
Duncan Lawrie Limited
EFG Private Bank Ltd
Europe Arab Bank plc
FBN Bank (UK) Ltd
FCE Bank Plc
FIBI Bank (UK) Ltd
Fortis Bank SA/NV
Ghana International Bank plc
Gulf International Bank (UK) Ltd
Gulf International Bank BSC
Habib Allied International Bank plc
Habib Bank AG Zurich
Habibsons Bank Ltd
Hampshire Trust plc
Harrods Bank Ltd
Havin Bank
HSBC Bank Group
Investec Bank Plc
Irish Bank Resolution Corporation Limited
Jordan International Bank plc
JP Morgan Chase Bank Group
Julian Hodge Bank Ltd
Kingdom Bank Ltd
Kleinwort Benson Bank Ltd
Lloyds Banking Group
Mashreqbank PSC
Metro Bank Plc
Mitsubishi UFJ Trust and Banking Corporation
Mizuho Corporate Bank Ltd
Mizuho International plc
Morgan Stanley Bank International Limited
N M Rothschild & Sons Ltd
Nacional Financiera SNC
National Australia Bank Limited
National Bank of Canada
National Bank of Egypt (UK) Ltd
National Bank of Greece SA
National Bank of Kuwait (International) plc
Nationwide Building Society
Nedbank Ltd
Nomura Bank International plc
Northern Trust Company
Punjab National Bank
Qatar National Bank SAQ
QIB (UK) plc
R Raphael & Sons plc
Rabobank International
Rathbone Investment Management Ltd
Reliance Bank Ltd
Royal Bank of Canada
Royal Bank of Canada Europe Ltd
Sainsbury’s Bank plc
Santander UK Group
Santander Cards UK Ltd
Schroder & Co Ltd
Scotiabank Europe plc {Part of The Bank of Nova Scotia Group}
Secure Trust Bank plc
Shawbrook Bank Limited
Smith & Williamson Investment Management Ltd
Société Générale
Standard Bank plc (formerly Standard Bank London Ltd)
Standard Chartered Bank
State Bank of India
State Street Bank and Trust Company
Sumitomo Mitsui Banking Corporation Europe Ltd
Sumitomo Mitsui Trust Bank Limited
Svenska Handelsbanken AB (publ)
Syndicate Bank
TD Bank NV
Tesco Personal Finance PLC
The Bank of New York Mellon Group
The Bank of Nova Scotia
The Bank of Tokyo Mitsubishi UFJ Limited
The Charity Bank Ltd
The Co-operative Bank Group
The Norinchukin Bank
The Royal Bank of Scotland Group
Triodos Bank NV
Union Bancaire Privee UBP
Union Bank UK plc
United National Bank Ltd
United Trust Bank Ltd
Unity Trust Bank plc
Virgin Money
VTB Capital Plc
Weatherbys Bank Ltd
Wells Fargo Bank NA
Wesleyan Bank Limited
Westdeutsche ImmobilienBank AG
Westpac Banking Corporation

BBA Associate Member List

ADT Fire and Security plc
Allen & Overy
Allied Bank Philippines (UK) Plc
avantage (UK) Ltd
Bank Monarch Ltd
Bank of England
Brown Brothers Harriman & Co
Business Control Solutions plc
Callcredit Limited
Capital One (Europe) plc
Clifford Chance
CLS Bank International
Equifax plc
Ernst & Young
Eversheds LLP
Exasoft Plc
Farrer & Co
Freshfields Bruckhaus Deringer
Government Banking Service
Herbert Smith Freehills LLP
Hinduja Bank (Switzerland) Ltd
Hogan Lovells
ING Direct NV
Innovative Systems, Inc.
Isle of Man Bankers’ Association
Jersey Bankers Association
Kinetic Partners
KnowCo Limited
Linklaters LLP
Mayer Brown
Morton Fraser LLP
National Savings & Investments
Norton Rose
Ordnance Survey
Pannone LLP
Premier European Capital Ltd
Riyad Bank
Shearman & Sterling LLP
Sidley Austin LLP
SJ Berwin LLP
Slaughter and May
Speechly Bircham
Tata Consultancy Services Ltd
The Post Office Ltd
Wolters Kluwer Financial Services
Wragge & Co LLP

Letter from BBA Chairman to Members—New Year Message

This is available on the BBA’s website:

I have now been Chairman of the Association for some three months and I want to use this New Year’s Message to give you my first impressions. I am the first Chairman who has not been associated with one of the major UK banks and so am, to that extent, independent and it is in this independent capacity that I write this letter. I intend to use that independence to seek to lead the Association in a way that is in the interest of the banking community as a whole and is in the wider public interest. Those two objectives are not in conflict: indeed, as with any responsible business, they must be mutually supportive.

It follows from these objectives that the guiding theme of all the Association’s work in 2013, and indeed for many years thereafter, has to be the restoration of trust and confidence in British banking. From my discussions with leading bankers, it is clear this is their agenda too. There is a growing appreciation that while the sustainable success of the bank is the key business objective, that success has to be coincident with what is generally perceived as working in the wider public interest. Many of you will tell me that this is much easier to write about than to achieve; and you would be right. It will require changes in culture within banks and better training for staff. It will require better communication about what banks do and why they do it. To those ends, work is already in progress, but there is much more to do.

Let me draw attention in this context to some work which we do already –the successful programme to support finance for business. This is one aspect of the approach set out in our in our draft strategy, where we commit ourselves to helping customers, promoting growth and raising standards. An example of this was in the Association’s submission to the Autumn statement, where we proposed measures our members believed would help growth across the whole economy some of which were reflected in the Chancellor’s Autumn Statement.

On the issue of raising standards, there is a debate now in progress about the possible establishment of “a Banking Standards Board” to oversee ethical standards in the banking industry. I put the phrase in inverted commas because the precise form and objectives of the initiative are as yet unclear. Your Association is participating in this debate and will early in January come up with options. But one thing is already clear. Whatever is decided—and I believe some form oversight of will be decided—that oversight will have to operate independent of bankers.

The Association itself cannot remain immune from the public criticism of banks and bankers. I judge that many perceive the Association as “a club where bankers talk to bankers”. We need to act to counter that impression. The Chief Executive, Anthony Browne, has taken a valuable initiative to establish a BBA Consumer Panel, to enable us to better listen to customers in our policy making. I believe that we should go further and I will ask the Association’s Board to consider the establishment of an Advisory Council for the Association. As a preparatory step the Board’s staff is carrying out a review of trade associations and other bodies who have Advisory Councils so that if the Board does decide to move in that direction, our decisions will represent best practice. The objective would be for the Board to have a source of independent, but informed, advice about public concerns relating to the conduct of banking and how we should react to those concerns. It would, I hope, be a concrete demonstration that the Association is ready to listen to advice from outside banking and so help guide the Association in our future work.

An excellent example of this approach—establishing a source of independent but informed advice—is our existing Business Finance Round Table. This brings together the banks, the statutory authorities and government together with business organisations such as the CBI and Federation of Small Businesses to support and guide policy to help small businesses. The UK’s banks have built a nationwide network to help small businesses get in touch with mentors, an independently-monitored appeals process for businesses initially declined a loan, and a referral system to put businesses in touch with alternative sources of finance.

Three final points. Chairmanship of the Association provides a good vantage point to appreciate the scale and breadth of banking activity in the UK, much of which has not been touched by the scandals that grab the headlines. Much of the business of banking and its support activities is carried outside the City of London and Canary Wharf and is a source of good jobs. Financial services employs 1.06 million people in the UK (454,200 in banking) and related professional services employ another million. London employs 641,000 people in banking and financial services; Edinburgh 50,500; Manchester 48,300; Birmingham 44,800; Leeds 40,500; Glasgow 37,500; Bristol 37,300. That needs to be better recognised.

Banking’s contribution to British exports needs to be better recognised too. In 2010, financial and professional services contributed £175 billion to the UK economy—some 14% of UK GDP. One third of financial services’ GDP contribution comes from exports (services provided to overseas clients). That contribution would not exist without the work of the foreign banks in London and elsewhere in the UK. It will be a priority of the Association to remind the relevant public authorities that London’s place as the pre-eminent international financial centre cannot be taken for granted.

The banking community is, for obvious and good reason, facing an avalanche of legislation. Much of it emanates from the European Union, though some of it comes from wider international initiatives, such as the G20. It is vital for the health of the banking sector and for its ability to serve its customers that there is a body, like the Association, which can offer informed advice to legislators in this country and abroad on the consequences, intended and otherwise, of legislative decisions. I am glad to say that the Association’s staff carries out this function with great dedication and expertise. I regard this as a core a function of the Association.

14 January 2012

1 As at 14/1/13

Prepared 19th June 2013