Crosby joined the Halifax bank in 1994 as Managing Director of Halifax Life. Five years later, he became the CEO of Halifax plc, and in 2001 became the first Executive Officer of the newly-formed HBOS Group. In 2006 Crosby left HBOS, which had become the fourth largest bank in the United Kingdom in terms of market capitalisation. It has been alleged that he had ignored warnings by HBOS’ former head of Group Regulatory Risk, Paul Moore, who had predicted that HBOS’s rapid growth left it vulnerable to a large number of borrower defaults. In 2005 Moore was sacked by Crosby.
During this period Crosby was appointed to a number of government supervisory bodies. In January 2004 he was appointed as Non-Executive Director of Financial Services Authority and in November 2007 became Deputy Chairman. He resigned in February 2009. In July 2006, Crosby was appointed to lead the Government’s Public Private Forum on Identity Management, and in 2006, he received a knighthood for services to the financial industry. In April 2008, Crosby was appointed to head up a Working Group of mortgage industry experts to advise the Government on how to improve the functioning of the mortgage market.
In 2009 he became chairman of software firm Misys, and later became a member of the European Advisory Board at Bridgepoint, and a senior independent director of catering firm Compass.
A Parliamentary report described Crosby as the “architect of the strategy that set the course for disaster” in his role as HBOS chief executive. In 2013 he formally requested that he be stripped of his knighthood.