Bankers Trust CEO discusses banking industry in crisis

Emelie Knobloch

Debt does indeed matter.

These were the words of Suku Radia, CEO and president of Bankers Trust, as presented “Banking – An Industry in Crisis: Is It Over Yet?” on Thursday, Nov. 14, at the Gerdin Building.

“Just how did this mighty industry get into such a mess?” Radia said. “There is a significant disagreement between the experts.”

Radia’s lecture provided an explanation to the causes of the banking industry’s problems that led to the Great Recession.

Radia also examined how the United States has fared since, and what lessons people have learned from the serious issues faced during this time.

“I fully expect the business degree at Iowa State to grow in value as it already has and will continue to do so,” Radia said.

Radia assumed his position at Bankers Trust in March 2008. Before this, he served as chief financial officer of Meredith Corporation for eight years.

Radia, born and raised in Kampala, Uganda, earned a Bachelor of Science from Iowa State in 1974 and became a certified public accountant in 1975 when he joined KPMG.

Radia said there are more investment capital in our system than we could use. He also said we chose the greedy option.

“Let us not be too greedy and appreciate what we have,” Radia said.

He also called out the federal government and said it did not do its part to prevent a meltdown of the mortgage market. Radia does believe that the crisis is over.

Radia said he believes instead of keeping interest rates artificially low, the Federal Reserve needs to take decisive action.

“The credit boom that showed signs of weakness at the beginning of 2007 completely disappeared. Financial institutions should not expect another bail-out from tax payer dollars,” Radia said. “The economy is moving forward, albeit slowly.”

This lecture was apart of the Stafford Lecture Series on Banking established by the College of Business and funded by Ames National Corporation as part of its 100 years of service to Ames.

“This is my first Stafford Lecture as dean,” said David Spalding, dean of College of Business. “However, I understand that the lecture is one of the hallmark events every year.”

The lecture series is in honor of Robert Stafford for his many years of dedicated service to First National Bank and Ames National Corporation.

“We proudly pay tribute to Bob’s legacy of service to this community,” Spalding said.

Stafford was awarded the Honorary Alumni Award in 2007. This award is the highest honor given by the university to individuals who are not graduates of Iowa State.