* FCA chairman says senior bankers "get" need for change
* Chief ombudsman says signs from top are encouraging (Adds comment from chief financial ombudsman)
By Matt Scuffham
LONDON, June 18 (Reuters) - Britain's retail banks have "gotit" in relation to cultural change and the need to guard againstmisconduct, the chairman of the country's financial regulatorsaid on Thursday.
The industry has been hit by a series of scandals in recentyears, including the mis-selling of loan insurance, which hasalready cost the industry more than 26 billion pounds ($41billion) in compensation, but the chairman of the FinancialConduct Authority said the banks understand the need to change.
"I think the retail banking sector in the UK has really gotit," John Griffith-Jones told the British Bankers Association'sretail banking conference.
"I think every chief executive and chairman wants to improveculture, but it doesn't move overnight, so it's a slightlydangerous situation where, to the outside world, it appearsnothing is happening," he said.
Griffith-Jones' comments were echoed by Caroline Wayman,chief executive of Britain's Financial Ombudsman Service, whichsteps in when customers and their banks are in dispute.
"I hear things from the top that I think are encouraging andI start to see examples of that in the real world. I think thatit takes times because individuals in organisations take time tobelieve that senior management mean it," she said.
The industry has continued to confront problems in relationto misconduct. Britain's biggest retail bank Lloyds forinstance was fined 117 million pounds by the financial regulatorthis month for failings in the way it handled complaints aboutmis-sold loan insurance.
Barclays, Royal Bank of Scotland and HSBC have also been embroiled in various controversiesincluding the mis-selling of complex hedging products to smallbusinesses.($1 = 0.6298 pounds) (Editing by David Holmes)