The document explores the significance of ethics in the banking industry, emphasizing compliance with laws to foster societal trust. It traces the history of banking from its ancient origins to modern ethical concerns, highlighting a shift towards more responsible financial practices. Ultimately, it asserts that ethics are essential for maintaining trust, which is crucial for the stability of the financial system.

3. Introduction:
Ethics in the banking industry is simply
defined as banks must be comply with all
laws, rules and regulations, levied by the
competent authority to enhance the
confidence of the society.

4. Banking History
Banking industry is one of the oldest industry of the world.
The first record of banking activity can be traced way back
in 2000 BC in Assyria and Babylonia when merchants of
ancient world made loans to farmers and traders that
carried goods. Later in ancient Greece and during the
Roman Empire lenders based in temples made loans but
also accepted deposits and changing money. The word
Bank came from French word banque, from Old Italian
banca, from Old High German banc. It is said that benches
were used as desks or exchange counters during the
Renaissance by Florentine bankers, who used to make
their transactions with the help of desks covered by green
tablecloths.

5. Banking Image
Banks have built a strong image around
bank accounts using the security argument
and sending the message across that
individuals were more at risk to lose their
money at home in unfortunate events than
in a bank. This argument has worked as
security measures were taken in banks to
ensure funds were physically safe and
secure.

6. Ethical Issues in Banking Industry
Empirical research since 1990 concluded that banks were
not interested in their own environmental situation or that
of their clients. Banks are only interested in making profits.
They just invest where they get large amount of profit.
They does not share information about the funds of
customers that they invest.
We are witnessing certain changes and growing awareness
in the field of financial sector like; environmental
investment funds, loans, green banking, global banking,
rural banking, agri-banking, social banking and ethical
banking.

7. Conclusions
Ethics are inextricably connected to the financial
world as they form the basis for trust. Without
trust the system is either dysfunctional or unstable
or both.
As “trust comes by foot, but leaves on horseback”,
it may take a while before we see results, but I am
confident results can be achieved. Banking
supervisors should be aware of these issues and
contribute to the process.