Large banks dug their own graves with mergers and takeovers, Dutch professor business-spirituality and jesuit Paul de Blot said today in Dutch newspaper het Financieele Dagblad.

During mergers and takeovers vital business components are often sacrificed, causing the enterprise to lose part of its soul, the professor claims. Executives should realize that the true capital of an enterprise are the people. Undermine their strength, and banks are doomed. “I liken it to losing an arm or a leg. Someone never really recovers from such a thing.”

The professor claims that banks have neglected their strengths by putting all their energy into avoiding mishaps. While there is no safety mechanism that is fail-proof. “If you emphasize your weaknesses, you make them bigger.” Instead, banks should focus on their strengths and allow them to flourish. One way to achieve this is by implementing a valuation system for strengths, thus stimulating positive aspects. An added downside of mergers is that the number of distinct brands, and their accompanying fan-base, decrease.

Another culprit, according to de Blot, is the lack of expertise in the banking industry. “The influx of knowledge is minimal,” he says, “A lot of the executives have a background in law. They have no idea they are setting up a pyramid scheme.”

Large bonuses
De Blot agrees with the popular opinion that it was greed that brought large financial institutions to their knees: offering large bonuses to executives, in spite of public unrest. “The money snatchers continue snatching. It’s been that way since the dawn of mankind.”

De Blot does see the advantages of Sharia banking. “There is a future with goals that go beyond making money out of money. That is where things went wrong with the current banks.” Also, people should first learn how to save up money, before they learn how to get credit. De Blot thinks highly of microcredit, a system where people help each other out by lending each other money. Naturally, he regrets the fact that the Dutch government banned this cooperative form of funding.