By Jim Parton
Published: 16 March 2012
Hector wasn’t a ‘card-carrying nasty bastard’. He was merely bland, writes former colleague Jim Parton
‘I couldn’t see the point of suffering in the City of London if the sums I earned were only mildly revolting, as opposed to completely obscene.’ These were the somewhat amoral opening words of my 1994 book, The Bucks Stop Here. It described my abortive career at various investment banks, and my wonderment at how so many not particularly talented people – and I included myself in this – could do so well.
Aged 30 or so, I ended up earning more than the Chancellor of the Exchequer. I came a cropper in the last credit crunch, the 1991 Japanese one. My clients were mostly Japanese financial institutions, my commissions melted away and I lost my job. In retrospect, it’s been a positive experience. I have done a million things I would never have had time for otherwise. Currently, I’m restoring a 17th century former bishop’s palace in Poland with my wife. Life is good.
One ex-banker who has left this process of self-examination a little long, if you ask me, is Hector Sants, the chief executive officer of the Financial Services Authority. This week he announced he would leave the FSA this summer. He was my boss at the respectable, but crumby, firm Phillips & Drew, a subsidiary of UBS, Union Bank of Switzerland. He was only a few years older than me and by any standards his advance had been stellar. Meanwhile we, his minions, were not the happiest crew. We sat in the dealing room which was the largest in the City in six or seven forty yard rows of salesmen, analysts and dealers. It had all the excitement of Heathrow Terminal 4.
As a boss, Sants was a remote figure, bland, a charisma-free zone. So I nearly choked on my cornflakes one morning some years later to hear the news on the radio that he was now chief executive of the FSA. What? Him? I nearly choked again a few years ago when I heard Gordon Brown praising the FSA as better than regulators in many countries. ‘Which ones?’ I thought. ‘Zimbabwe? Ukraine? Iceland?’
Phillips & Drew was a muddle. I remember there were frequent changes and the creation of new responsibilities. A new memo would arrive on my desk each day along the lines of ‘Smith will spearhead the marketing of Belgian equities into Andorra. Smith’s duties will be taken over by Jones, our new hiring from Warburgs.’ It was usually Sants’s signature on the memos about Belgian equities…
‘One should not despise mediocrity,’ I went on in The Bucks Stop Here, ‘as the purveyance thereof undoubtedly fills a market niche…’ In so many words, I was saying that I could not understand how he had reached such giddy heights so young. I didn’t spell this out, for fear of a libel writ, but I feel safe now in saying that I thought he was a total mediocrity, as did many who sat around me.
I was right to fear a libel writ. It turn out that Sants is thin-skinned. I had written in my book, ‘My boss was a thick, ignorant, card-carrying, nasty bastard.’ A financial journalist at The Independent picked up on this and repeated the comment in a diary piece. Unfortunately, the journalist hadn’t read the book closely; I’d been talking about my immediate line manager, not Hector Sants, who was — as I say — merely bland. I hurriedly penned a note to the Indy saying, ‘You’ve got the wrong bloke…’ and Sants got a £5,000 pay-off.
Later, friends of friends reported back to me that Hector was telling the story at dinner parties. ‘That paid for a nice holiday,’ he was supposed to have said. A very nice holiday, especially in 1994 money. Over a decade later and the anecdote had evolved. Hector was telling a dinner party that he had used the money to buy an avenue of cherry trees for his local church. I prefer this version of the story and am happy to set the record straight. Hector was too dull a man to pocket the wonga and go on a pretty amazing holiday.
I have to admit that I wasn’t particularly happy at Phillips & Drew, and this no doubt colours what I have to say. But as I say, Sants was remote, and I barely knew him, and have not seen him for the best part of two decades. My City career ended at a different firm, I bear him no personal grudge, I’m not settling old scores in writing this. However, the record speaks for itself. Phillips & Drew under Sants was not a notable success. It lost market share after various ructions and eventually faded away to nothing. To stay it the game, UBS gave up with it and bought the top investment bank of the time, Warburgs.
The Bucks Stop Here, being newly topical, was republished last year, and so I fell to reflecting on Hector. And the more I thought about him the angrier I became. The only grudge I bear him is the one that all Britons should bear. That he and the organisation over which he presided failed to properly regulate the banks. I just don’t buy it that no one knew what was coming.
LIFE AND TIMES OF HECTOR SANTS
BORN: December 15, 1955.
EDUCATION: Clifton College, Bristol; Corpus Christi, Oxford.
FIRST JOB: trainee analyst at brokers Phillips & Drew
KEY CAREER MOVES: partner, Phillips & Drew; vice chairman UBS; chief executive of Europe, Middle East and Africa for Credit Suisse; head of wholesale and institutional markets for the FSA; chief executive, FSA
HOBBIES: organic farming, shooting, skiing, painting, military history, classic cars
MARRIED: with three sons
This article was written for the Mail on Sunday in Feb 2010 at the time of Sants first resignation from the FSA, but it has never been published before. Jim Parton worked alongside Hector Sants at Phillips & Drew in the 1990s and is author of the best-selling (and hilarious) book about City life, The Bucks Stop Here: Money Talks and Mine Said Goodbye.