Even the banking industry realizes there is no reason not to disclose a loan once it has been made.

The latest example is Credit Suisse’s Thiam pushing a Transparent Lending Covenant after his bank got burned lending money.

Developing countries need to do more – a lot more in some cases – to tackle corruption, but so do the banks. One idea is a Transparent Lending Covenant, under which banks would make the full details of loans public. Interestingly, the idea is being pushed by Tidjane Thiam, who took over as chief executive of Credit Suisse after the Mozambique loan was agreed. It’s not hard to see why. The tuna deal stank in every way. It was bad for Mozambique, bad for the City and bad for Credit Suisse.

What Thiam realizes is once a loan is disclosed to the financial markets, if there is any fraud involved, it will quickly be sniffed out and the lender’s chance for a full recovery is greatly enhanced.

Thiam is explicitly acknowledging banks are better off making their loans transparent to the financial markets and regulators.  At a minimum, it improves the collectibility of the loans.

Having acknowledged banks could disclose their lending in real time, there is no reason banks shouldn’t disclose all of their current positions and therefore qualify for a label from the Transparency Label Initiative.