UPDATE 1-Barclays fires back, says hostility to banks unhealthy

Mon Jun 10, 2013 12:46pm EDT
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* Chairman insists banks play vital role in recovery

* Says Barclays working on adjusting compensation

* Sees Sumitomo sale of Barclays stake as a one-off

* Says easy money cannot continue indefinitely

By Randall Palmer and Louise Egan

MONTREAL, June 10 (Reuters) - Barclays PLC Chairman David Walker hit back on Monday against what he said has become the "political and media industry" of badmouthing banks and bankers, and insisted on banks' vital role in a free-market economy.

"The persistence of hostility to banks and bankers, much more marked in Europe than elsewhere, is in my view seriously unhealthy," he told the economic Conference of Montreal.

"The function of banking needs to be recognized as a key contributor to recovery in a developed world, in which credit is principally extended through the banks and the market rather than through state-run conduits."

Barclays, Britain's second-largest bank, and the banking industry in general have been under pressure for their role in the recent financial crisis. Barclays has been told to rein in pay for top staff and to tighten control of its operations after a string of scandals.   Continued...