Drivers License for Bankers

http://www.cnbc.com/id/30976042

Dutch Finance Minister Wouter Bos plans on implementing a test for anyone serving on a Banking Board. Even Gerrit Zalm, former Finance Minister, who runs the now nationalized of ABN Amro will be required to take the test which is being called “Drivers License for Bankers.” Details of who will create and administer the test have not been worked out yet but will most likely fall to Dutch Central Bank DNB.

The Dutch banking sector’s reputation, like that of many other nations including the U.S. has suffered during the economic crisis. Minister Bos formed a commission to find ways to restore the public’s faith in the banking industry. The committee came up with the recommendation of a required test which would ensure that top banking executives have the necessary expertise and qualifications to run a bank.

In class yesterday we talked about the role of the government in the public sector varies among countries. In the Untied States, banking is subject to increasing scrutiny and regulation by the public sector. The U.S. President has flexibility to appoint the best, brightest and most qualified person to work in banking regulations. In U.K., top positions, including those which regulate banking, are held by members of Parliament. The person in charge of banking may or may not have a background or expertise in banking. In France public servants, including those who regulate banking have been trained at Le Grande Ecole and may have some training in this area. The Dutch Banking Drivers License is the government getting involved in the banking sector to make sure that top officials have the required level of expertise to work in this field. But will this restore the public’s faith in the banking industry? Should a similar test be implemented around the globe?

Jen S