Ethics in Banking

Topics: Sales, Bank, Ethics Pages: 4 (1335 words) Published: October 29, 2010
Banking ethics are the moral or ethical principles that certain banks choose to abide by. There is not a universal code of ethical conduct, but the banks that vaunt their ethical credentials evaluate the ethical standing of potential investors and partners. Also, these banks choose the companies that they in turn invest in with their ethical policy in mind. The number of ethical questions that the banking industry faces are many and multifaceted. Full service relationships with customers are a thing of the past while profitability, and its byproduct corporate greed, has become the main goal. Banking ethics and profitability are not mutually exclusive, but being an ethical bank does sometimes mean that they maintain their moral rigor at the cost of profitability. The banking industry has said out with the old customer oriented business and in with the new sales oriented business (Banking Ethics 2004). There have been many ethical changes over the years in the banking industry. A lot of the bad ethical decisions made by bank executives and employees are in large part the reason our economy is currently in shambles. One of the most noticed changes have been made in the ‘front of the house’ retail banking. Where once the strategy was, "Let's just sit back and wait for a customer to come through the door," it's now "We've got to get out there and find good customers." (Letourneau 1997). The days that every customer could sit with their banker sipping a cup of coffee and discussing things other than adding new products to their portfolio are over. Like the absence of relationship banking, long-time customers are also losing their once strong financial trust that the banking industry was known for. Instead, when they walk into a local branch of their bank to make a simple transaction, such as a deposit or a withdrawal, they are just another potential sale for the anxiously awaiting personal banker. The chances of you completely your transaction and leaving...
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