Short-termism has been 'hugely damaging' for banks says Sir David Walker He attacked plans to introduce a Europe-wide pay cap, saying such a measure was "very retrograde and to be resisted." In comment that what will be seen as a warning to Barclays staff and shareholders the veteran banker forecast lower payouts in future. "Returns on equity will fall, which will not only put pressure on how much is available to pay out in remuneration, but also what is available to pay out in dividends," he said. Sir David added that shareholders were also "an important part of the problem" and should share the blame for some of the industry's problems. "They encouraged banks to lever up," he said. Sir David appointment as Barclays chairman last month followed the resignation of Marcus Agius in July following the bank's admission it had attempted to rig Libor. Along with Mr Agius, Bob Diamond, the bank's chief executive, as well as Jerry del Missier, its chief operating officer, also resigned in the wake of the Libor scandal. Sir David said banks had to move quicker to deal with the fallout from past scandals and warned the cost of compensating customers mis-sold payment protection insurance and interest rate swaps was likely to rise. "PPI and swap mis-selling need to be dealt with more expeditiously that the banks are currently doing and that is going to be expensive," he said.