Sir James Crosby must be given some credit for volunteering to forgo a chunk of his lucrative HBOS pension and, in an unprecedented move yesterday, surrendering his knighthood. His actions are in stark contrast to those of "Fred the Shred", the former RBS banker who was stripped of his knighthood in 2012 and gave up part of his even more lucrative pension only after public and political pressure.

But that's about as far as Crosby's credit goes. His decision comes just a week after an excoriating report into HBOS branded him one of the primary architects of the doomed bank's downfall, along with former chairman Lord Stevenson and another former chief executive, Andy Hornby.

Publication of the damning report – An Accident Waiting to Happen – came five years after the collapse of the bank but the parliamentary commission on banking standards made it clear that, even without the global financial crisis, HBOS would have gone bankrupt, a victim of its high-risk strategy and incompetent, reckless, delusional management.

Using some of the hardest-hitting language ever seen in a parliamentary report, the commission talked of the "colossal failure" of the bank, created in 2001 through the over-ambitious merger of Halifax and Bank of Scotland. At the time, the combined company was worth £30 billion but, said conservative MP Andrew Tyrie, who heads the commission: "The sums would never have added up." In 2008, the bank was bailed out with more than £20 billion of taxpayers' money, necessary to prevent its complete collapse.

'Deeply sorry'
Knighted for "services to the financial sector" in 2006, shortly after he left HBOS, Crosby said yesterday he was "deeply sorry. His knighthood had been "an enormous honour" but he believed it was right he ask the authorities "to take the necessary steps for its removal".

Also being removed – again, voluntarily – is a near one-third chunk of Crosby’s £580,000-a-year pension entitlement, taking it down to £403,000 per annum. The former HBOS boss indicated that it had yet to be decided whether the amount waived should go to support good causes or benefit shareholders.

That will still leave Crosby, who sold the bulk of his shares in the bank before the financial crisis struck, with an index-linked pension of £406,000, rather more than Fred Goodwin, who is rubbing by on £342,500. That is slightly less than half Goodwin's original £700,000, following his reluctant decision to surrender £200,000 of it after he took out a lump sum of £2.8 million, which reduced the £700,000 to £555,000 a year).

Crosby has quit his position as an advisor to the private equity firm Bridgepoint, stepping aside last Friday, and has also given up his voluntary role as a trustee of Cancer Research UK, as well as his place on the board of the catering firm Compass. Following the report last week, the board of the FTSE 100 company had notably failed to give him any public backing - unlike his fellow architect of failure, Andy Hornby, who received a glowing statement of support from his current employers, the casinos company Gala Coral. Their chief executive was “doing a great job” and has the complete backing of the business, the company said.

Part-time role
Former HBOS chairman Lord Stevenson, meanwhile, remains a peer of the realm and has yet to bre ak his silence in the wake of the report. He enraged MPs on the banking commission by claiming during hearings that he was not at fault because his role at the bank was only part-time. Stevenson remains on the board of books retailer Waterstones, and is a director of private equity firm Manocap.

The business secretary, Vince Cable, is looking at whether Crosby, Stevenson and Hornby can be banned as company directors for life. So far, only one HBOS executive, Bank of Scotland's former head of commercial lending, Peter Cummings, has faced sanctions in the wake of the affair. He was fined £500,000 last year and banned for life from working in the City but complained of being scapegoated.

Crosby’s request to surrender his knighthood will now be considered by what’s known as the honours forfeiture committee, led by the head of the civil service and made up of Whitehall mandarins. It is unlikely to take them long to decide.

Fiona Walsh writes for the Guardian in London

This article was amended on April 10th to correct a factual error.