The financial crisis ‘black swan’ has thankfully flown away. Yes, it rearranged the financial landscape in many countries and left an indelible mark on others.  The world reacted with bailouts, consolidation, regulation and restoration. But in my view, the crisis’ biggest impact is the change it has brought to the banking psyche.

Say goodbye to aggressive banking and hello to progressive.

As banks pause for breath and plan their next move, they’re acutely aware of the need to redeem themselves in the eyes of their customers. Some sowed the seeds of repentance early, when the crisis was still raging, by taking a more sympathetic view of their customers’ inability to meet financial commitments brought on by the loss of a job or the wiping out of their savings. Now, a number of institutions are carrying this idea forward with a more inclusive flavor of banking. Thus, they’re talking ‘ours’ instead of ‘yours’ in relation to the risks and costs of financial transaction, and just the opposite in relation to profit. They’ve reset their expectations of executive compensation and business growth to a more reasonable level. Generosity is taking the place of greed, as banks look to heal the wounds dealt by the failed promise of aggressive returns on fancy products, by offering better terms, more freebies and greater bang for the buck.

But, I think that the most significant reformation will be visible in future financial innovation. Until now, banking product innovation has trodden the opposite path to innovation in other sectors.  While the latter have followed a model of ‘creative destruction’, that is, destroying something less usable or inferior to create something of economic value, banking has destroyed by creating, what I can only term as “weapons of mass destruction” (WMD) in the form of Credit Default Swaps and other complex products few understood. Since banking is mending its ways, I anticipate that going forward, it will trade this WMD for another – that which creates wealth for mass development.

Amen to that.