When Dame Alison Rose was a frontrunner for chief executive of NatWest in 2019, I described her as ‘sensible’ and ‘unspun’ and said I hoped she’d get the job. That view was based partly on personal impression and partly on a prejudice of mine, expressed consistently since the 2008 crisis, that women often make better senior bankers than men, being less prone to macho risk-taking.

Rose has now yielded to political pressure and resigned over her role in the false reporting of the decision to ‘exit’ Nigel Farage as a customer of NatWest’s subsidiary, Coutts. But this column has never been in the business of following the baying crowd in hounding corporate chiefs from office. I did not agree with Boris Johnson’s demand, in the Daily Mail, that Rose’s head should roll if (as she finally admitted on Tuesday) she told the BBC that Farage had been binned for holding insufficient funds, rather than for the judgmental reasons revealed in a leaked Coutts report. I’m sorry she’s gone.

There’s no doubt, mind you, that the dame had spun herself – or been spun by Coutts boss Peter Flavel and his ‘head of client coverage’ Camilla Stowell, both of whose heads may have to roll with hers – into a five-star PR fiasco.

But it’s worth trying to understand the wider context. Underlying the Farage episode is the pickle in which all major banks find themselves as they contend with perceived reputational threats of all kinds and related anti-money-laundering issues, on top of pressures internal and external to preach the gospel of ‘inclusion’ and ‘purpose’.

Time was when London banks were full of loot deposited by dictators and oligarchs. Likewise, a global bank such as HSBC might exude high moral tone in the boardroom while its Mexican branch provided facilities for murderous drug cartels.

Reputational reverse nowadays – as in the case of Silicon Valley Bank, assailed by insolvency rumours – spreads so fast by social media that it can prove fatal within hours. As for NatWest, it operates under that name because of the terrible reputation it acquired, for vainglorious risk behaviour and harsh treatment of business customers, in its previous incarnation as RBS. It was Alison Rose who sought to complete the transformation by declaring the renamed bank to be ‘Purpose-led… helping people, families and businesses to thrive’.

None of which, you may tell me, has anything to do with the case of Coutts vs Farage. But my point is that banks today operate within a vast, creaking Heath Robinson construct of regulation and process designed to avoid reputational disasters. That includes mandatory annual reviews of ‘high-risk’ customers in politics and public life – who may not know, until a loan is refused or a card stopped, that they fall in that category. The whole paraphernalia is a hugely costly bureaucratic burden of the banks’ own making, because all of this was so badly done in the past. In the hands of over-zealous, ‘purpose-led’ middle-managers, it’s bound to go wrong. So it has for Coutts, whose business will suffer accordingly.

Kneejerk reaction

Meanwhile, the kneejerk reaction from No.10 was to call for new regulations requiring clear explanation and longer notice for bank account closures. But that will merely add to the pickle if they collide with existing ‘tipping off’ rules (under the Proceeds of Crime Act 2002) that ban banks from giving closure information to customers suspected of financial wrongdoing. The National Crime Agency is reported to be lobbying against the ministerial proposals and I wouldn’t bet on them passing swiftly into law.

As for Dame Alison, the NatWest board’s declaration of ‘full confidence’ in her saved her bacon for less than 12 hours. But I still say her departure was unnecessary. NatWest needs a sensible helmsman. Farage had his media triumph. A systemic mess had been highlighted. Stand by now for multiple claims from ‘politically exposed persons’ and others of similar deceit, mishandling and in-discretion by their banks. This story will run and run.

Reality cheque

Boris Johnson’s column castigating Dame Alison contained a series of barbed rhetorical questions and one oblique reference to his days at Eton: ‘Coutts is no longer the self-styled posho bank used by kids at my school, who would buy turkey sandwiches from the tuck shop with 50p Coutts cheques.’ In those days, Eton High Street had a convenient Coutts branch where many pupils opened their first accounts. Was Johnson himself a sandwich-scoffing kid-customer? Might he perhaps have subsequently been exited, not as a reputational risk but for the well-known chaos of his personal finances? Perish the thought that I should encourage a further breach of client confidentiality, but I think we should be told.

Stupid game

On a lighter, related note, my call for nominations as to whose accounts we would cancel if this column were a bank produced such a colourful throng of personae non grata that Nigel Farage might have ended up as our only customer. Top of the list were highly paid but striking hospital consultants and Aslef train drivers, who would clearly need a fancier wealth management service than our modest venture could offer. Next came over-bonused Post Office managers, most Premiership footballers, ‘anyone associated with HS2’ and ‘anyone who’s ever appeared on Love Island’.

Among individual candidates, Gary Lineker, Sadiq Khan and (rather unkindly, I thought) Barbie led the voting. But I’m also grateful to one reader who reminded me of the danger of suggesting, even in jest, that it’s OK to constrain the rights of those we dislike or with whom we disagree, lest we should find the tide of intolerance turning on ourselves: ‘When you play stupid games, you win stupid prizes.’