Investment Banking: Technology and the Decline of Trust

‘Up or out’ promotion policies and reward systems that encourage ‘star’ bankers to ‘shine’ by taking unacceptable risks were significant factors in the 2007-2009 financial crisis. But they need to be viewed in a broader context. The seeds of trouble were sown decades previously, when a trend towards ‘transactional’ models, powered by technology, began to transform investment banks.