Ottawa to buy $50B in mortgages, hopes to spur loans

November 12 2008

The federal government is purchasing another $50 billion in residential mortgages to further stabilize the lending industry and encourage lower interest rates, Finance Minister Jim Flaherty announced Wednesday.

The Canadian economy has stalled and is on the brink of a recession. The government hopes that its cash injection will keep consumers spending and keep businesses afloat.

The announcement follows a similar move last month in which Ottawa bought $25 billion in mortgages.

The combined mortgage debt, both purchased through the Canadian Mortgage and Housing Corp. (CMHC), will bring the maximum value of bought securities to $75 billion.

“At a time of considerable uncertainty in global financial markets, this action will provide Canada’s financial institutions with significant and stable access to longer-term funding,” Flaherty said at a press conference in Toronto.

“This extension of the program to purchase insured mortgages will further support the availability of credit, which will benefit Canadian households, businesses and the economy.

“In addition, it will earn a modest rate of return for the Government with no additional risk to the taxpayer.”

Flaherty said the government “will not allow Canada’s financial system, which has been ranked as the soundest in the world, to be put at risk by global events.”

Patrick Grady of Global Economics LTD told CTV News, “the banking system would weather this storm whether the government provided assistance or not. But what it would do is cut back on loans it made.”

Will the move help average Canadians?

It is hoped that the announcement will be a boon to entrepreneurs like Joseph Saikely, the owner of an upscale hair salon in Ottawa.

He said despite the economic downtown, business at his salon, Byblos, is booming.

Saikely says he wants to expand his operation, but can’t get a loan from the banks.

“We have been trying to expand for the last few months, even trickling it down to a minor renovation and there is just not one dollar to be given out or lent,” he told CTV News.

Flaherty says that the $50 billion in mortgage purchases should allow banks to start lending again with greater ease.

“It is up to private sector lenders to keep on doing their jobs, making loans to credit worthy people and enterprises of all sizes,” he said.

But Saikely isn’t hopeful that the banks will start passing on the loans anytime soon.

“Put it in the hands of people that will do something with it, the banks are doing absolutely nothing will it,” he said.

Last month, Canada’s big banks lowered their prime lending rates following the announcement about the $25 billion buyout.

Not a bailout, gov’t says

The Tories have been quick to indicate that the deal to buy mortgages is an asset swap, not a bailout.

The idea is that banks can take good assets, in this case the mortgages, and turn them into cash — which can then be made available to people seeking mortgages or to small business.

The “high-quality” assets are already guaranteed by the Canadian government, Flaherty said.

“It is an efficient, cost-effective and safe way to support lending in Canada at a time of extraordinary strain in global credit markets,” he said.

Despite the global financial crisis, Flaherty said he still expects to report a budget surplus.

“We’re still on track for a small, and I emphasize small, surplus in the current fiscal year,” he said.

Meanwhile, the Bank of Canada said Wednesday it will inject an added $8 billion into Canada’s tight money markets.

The Bank said it plans to introduce a Canadian Dollar Term Loan Facility (TLF) in four auctions of $2 billion each in the coming weeks.

Under the plan, qualifying financial institutions will be able to offer non-mortgage loans as collateral — meaning they can offer most loans currently on their books.

Finance Minister Jim Flaherty announces that Ottawa will be purchasing another 50 billion dollars in residential mortgages. View Video

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Foreign currency loan crux for fomer communist bloc

November 5 2008

Eastern European markets are feeling the pinch as investors pull money out of the region and local currencies plunge. Plunging domestic currencies mean higher monthly payments for businesses and households repaying foreign-denominated loans, forcing them to scale back spending.

In Budapest, project manager Imre Apostagi says the hospital upgrade he’s overseeing has stalled because his employer can’t get a foreign-currency loan.

The company borrows in foreign currencies to avoid domestic interest rates as much as double those linked to dollars, the euro and Swiss francs. Now banks are curtailing the loans as investors pull money out of eastern Europe‘s developing markets and local currencies plunge.

“There’s no money out there,” said Mr Apostagi, a project manager who asked that the medical-equipment seller he works for not be identified to avoid alarming international backers.

“We won’t collapse, but everything’s slowing to a crawl. The whole world is scared and everyone’s going a bit mad.”

Loans

Foreign-denominated loans helped fuel eastern European economies including Poland, Romania and Ukraine, funding home purchases and entrepreneurship after the region emerged from communism.

The elimination of such lending is magnifying the global credit crunch and threatening to stall the expansion of some of Europe’s fastest-growing economies.

“What has been a factor of strength in recent years has now become a social weakness,” said Tom Fallon, head of emerging markets in Paris at La Francaise des Placements, which manages $11bn.

Since the end of August, the Hungarian forint has fallen 16pc against the Swiss franc, the currency of choice for Hungarian homebuyers, and more than 8pc against the euro.

Foreign currency loans make up 62pc of all household debt in the country, up from 33pc three years ago.

Romania’s leu dropped more than 14pc against the dollar and 3.2pc against the euro.

Poland’s zloty declined more than 17pc against the dollar and 6.8pc against the euro, and Ukraine’s hryvnia plunged 22pc to the dollar and 11.5pc to the euro.

That’s even after a boost this week from an International Monetary Fund (IMF) emergency loan programme for emerging markets and the US Federal Reserve‘s decision to pump as much as $120bn into other developing countries.

The Fed said yesterday that it aims to “mitigate the spread of difficulties in obtaining US dollar funding”.

In Kiev, Ukraine, Yuriy Voloshyn, who works at a real-estate company, says he’s decided to abandon plans to buy a new television because of his dollar-based mortgage. His monthly payments have risen by 18pc, or 1,000 hryvnias (€130), since he took out the loan seven months ago.

“I only have money to pay for food and my monthly fee to the bank,” Mr Voloshyn(25) said. “I can’t even dream about anything else.”

Rafal Mrowka, a driver from Ostrow Wielkopolski in western Poland, says he became addicted to checking foreign currency rates as monthly installments on his Swiss-franc mortgage jumped 25pc.

Nervous

“I’ve even stopped getting nervous, now I can only laugh,” the 32-year-old, first-time property owner said.

The bulk of eastern Europe’s credit boom was denominated in foreign currencies because they provided for cheaper financing. For example, Hungarian consumers borrowed five times as much in foreign currencies as in forint in the three months to June.

Now banks including Munich-based Bayerische Landesbank and Austria‘s Raiffeisen International Bank Holding AG are curbing foreign-currency loans in Hungary.

In Poland, where 80pc of mortgages are denominated in Swiss francs, Bank Millennium SA, Getin Bank SA and PKO Bank Polski SA have either boosted fees or stopped lending in the currency.

The extra burden on borrowers is making a bad economic outlook worse, said Matthias Siller, who focuses on emerging markets at Baring Asset Management in London, where he manages about $4bn.

If borrowers believe local interest rates are prohibitive and foreign currency lending dries up, it means “a sharp deceleration in consumer spending,” Mr Siller said. “That will bring serious problems for the economy.”

The east has been the fastest-growing part of Europe, with Romania’s economy expanding 9.3pc in the year through June, Ukraine 6.5pc and Poland 5.8pc. The combined economy of the countries sharing the euro grew 1.4pc in the period.

Ukraine, facing financial meltdown as the hryvnia drops and prices for exports such as steel tumble, has agreed to a $16.5bn loan from the IMF while Hungary secured $26bn in loans from the IMF, the EU and the World Bank. The government forecast a 1pc economic contraction next year, the first since 1993.

The Hungarian central bank raised its benchmark interest rate by three percentage points to 11.5pc last month to defend the forint.

“Panicked customers are calling to say they’re afraid the interest on their mortgages will go up or that they won’t be able to secure mortgages,” said Nikolett Gurubi, director of lending at Otthon Centrum Belvaros, the downtown Budapest branch of a real estate agency.

“We’ve been observing a return to a good old banking rule, to lend in a currency in which people earn,” said Jan Krzysztof Bielecki, chief executive officer of Poland’s biggest lender, Bank Pekao SA.

It stopped non-zloty lending in 2003.

“Earlier, banks competed on the Swiss franc market watching only sales levels and not looking at keeping an acceptable risk level.”

The problem is a “good lesson to all of us”, Polish President Lech Kaczynski said last month at a press conference in Warsaw, where he urged Poles to stick to zloty lending.

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AIG Already Running Through Government Loans

October 30 2008

The American International Group is rapidly running through $123 billion in emergency lending provided by the Federal Reserve, raising questions about how a company claiming to be solvent in September could have developed such a big hole by October. Some analysts say at least part of the shortfall must have been there all along, hidden by irregular accounting.

“You don’t just suddenly lose $120 billion overnight,” said Donn Vickrey of Gradient Analytics, an independent securities research firm in Scottsdale, Ariz.

Mr. Vickrey says he believes AIG must have already accumulated tens of billions of dollars worth of losses by mid-September, when it came close to collapse and received an $85 billion emergency line of credit by the Fed. That loan was later supplemented by a $38 billion lending facility.

But losses on that scale do not show up in the company’s financial filings. Instead, AIG replenished its capital by issuing $20 billion in stock and debt in May and reassured investors that it had an ample cushion. It also said that it was making its accounting more precise.

Mr. Vickery and other analysts are examining the company’s disclosures for clues that the cushion was threadbare and that company officials knew they had major losses months before the bailout.

Tantalizing support for this argument comes from what appears to have been a behind-the-scenes clash at the company over how to value some of its derivatives contracts. An accountant brought in by the company because of an earlier scandal was pushed to the sidelines on this issue, and the company’s outside auditor, PricewaterhouseCoopers, warned of a material weakness months before the government bailout.

The internal auditor resigned and is now in seclusion, according to a former colleague. His account, from a prepared text, was read by Representative Henry A. Waxman, Democrat of California and chairman of the House Committee on Oversight and Government Reform, in a hearing this month.

These accounting questions are of interest not only because taxpayers are footing the bill at AIG but also because the post-mortems may point to a fundamental flaw in the Fed bailout: the money is buoying an insurer — and its trading partners — whose cash needs could easily exceed the existing government backstop if the housing sector continues to deteriorate.

Edward M. Liddy, the insurance executive brought in by the government to restructure AIG, has already said that although he does not want to seek more money from the Fed, he may have to do so.

Continuing Risk

Fear that the losses are bigger and that more surprises are in store is one of the factors beneath the turmoil in the credit markets, market participants say.

“When investors don’t have full and honest information, they tend to sell everything, both the good and bad assets,” said Janet Tavakoli, president of Tavakoli Structured Finance, a consulting firm in Chicago. “It’s really bad for the markets. Things don’t heal until you take care of that.”

AIG has declined to provide a detailed account of how it has used the Fed’s money. The company said it could not provide more information ahead of its quarterly report, expected next week, the first under new management. The Fed releases a weekly figure, most recently showing that $90 billion of the $123 billion available has been drawn down.

AIG has outlined only broad categories: some is being used to shore up its securities-lending program, some to make good on its guaranteed investment contracts, some to pay for day-to-day operations and — of perhaps greatest interest to watchdogs — tens of billions of dollars to post collateral with other financial institutions, as required by AIG’s many derivatives contracts.

No information has been supplied yet about who these counterparties are, how much collateral they have received or what additional tripwires may require even more collateral if the housing market continues to slide.

Ms. Tavakoli said she thought that instead of pouring in more and more money, the Fed should bring AIG together with all its derivatives counterparties and put a moratorium on the collateral calls. “We did that with ACA,” she said, referring to ACA Capital Holdings, a bond insurance company that filed for bankruptcy in 2007.

Of the two big Fed loans, the smaller one, the $38 billion supplementary lending facility, was extended solely to prevent further losses in the securities-lending business. So far, $18 billion has been drawn down for that purpose.

For securities lending, an institution with a long time horizon makes extra money by lending out securities to shorter-term borrowers. The borrowers are often hedge funds setting up short trades, betting a stock’s price will fall. They typically give AIG cash or cashlike instruments in return. Then, while AIG waits for the borrowers to bring back the securities, it invests the money.

In the last few months, borrowers came back for their money, and AIG did not have enough to repay them because of market losses on its investments. Through the secondary lending facility, the insurer is now sending those investments to the Fed, and getting cash in turn to repay customers.

A spokesman for the insurer, Nicholas J. Ashooh, said AIG did not anticipate having to use the entire $38 billion facility. At midyear, AIG had a shortfall of $15.6 billion in that program, which

it says has grown to $18 billion. Another spokesman, Joe Norton, said the company was getting out of this business. Of the government’s original $85 billion line of credit, the company has drawn down about $72 billion. It must pay 8.5 percent interest on those funds.

An estimated $13 billion of the money was needed to make good on investment accounts that AIG typically offered to municipalities, called guaranteed investment contracts, or GICs.

When a local government issues a construction bond, for example, it places the proceeds in a guaranteed investment contract, from which it can draw the funds to pay contractors.

After the insurer’s credit rating was downgraded in September, its GIC customers had the right to pull out their proceeds immediately. Regulators say that AIG had to come up with $13 billion, more than half of its total GIC business. Rather than liquidate some investments at losses, it used that much of the Fed loan.

For $59 billion of the $72 billion AIG has used, the company has provided no breakdown. A block of it has been used for day-to-day operations, a broad category that raises eyebrows since the company has been tarnished by reports of expensive trips and bonuses for executives.

The biggest portion of the Fed loan is apparently being used as collateral for AIG’s derivatives contracts, including credit-default swaps.

The swap contracts are of great interest because they are at the heart of the insurer’s near collapse and even AIG does not know how much could be needed to support them. They are essentially a type of insurance that protects investors against default of fixed-income securities. AIG wrote this insurance on hundreds of billions of dollars’ worth of debt, much of it linked to mortgages.

Through last year, senior executives said that there was nothing to fear, that its swaps were rock solid. The portfolio “is well structured” and is subjected to “monitoring, modeling and analysis,” Martin J. Sullivan, AIG’s chief executive at the time, told securities analysts in the summer of 2007.

Gathering Storm

By fall, as the mortgage crisis began roiling financial institutions, internal and external auditors were questioning how AIG was measuring its swaps. They suggested the portfolio was incurring losses. It was as if the company had insured beachfront property in a hurricane zone without charging high enough premiums.

But AIG executives, especially those in the swaps business, argued that any decline was theoretical because the hurricane had not hit. The underlying mortgage-related securities were still paying, they said, and there was no reason to think they would stop doing so.

AIG had come under fire for accounting irregularities some years back and had brought in a former accounting expert from the Securities and Exchange Commission. He began to focus on the company’s accounting for its credit-default swaps and collided with Joseph Cassano, the head of the company’s financial products division, according to a letter read by Mr. Waxman at the recent Congressional hearing.

When the expert tried to revise AIG’s method for measuring its swaps, he said that Mr. Cassano told him, “I have deliberately excluded you from the valuation because I was concerned that you would pollute the process.”

Mr. Cassano did not attend the hearing and was unavailable for comment. The company’s independent auditor, PricewaterhouseCoopers, was the next to raise an alarm. It briefed Mr. Sullivan late in November, warning that it had found a “material weakness” because the unit that valued the swaps lacked sufficient oversight.

About a week after the auditor’s briefing, Mr. Sullivan and other executives said nothing about the warning in a presentation to securities analysts, according to a transcript. They said that while disruptions in the markets were making it difficult to value its swaps, the company had made a “best estimate” and concluded that its swaps had lost about $1.6 billion in value by the end of November.

Still, PricewaterhouseCoopers appears to have pressed for more. In February, AIG said in a regulatory filing that it needed to “clarify and expand” its disclosures about its credit-default

swaps. They had declined not by $1.6 billion, as previously reported, but by $5.9 billion at the end of November, AIG said. PricewaterhouseCoopers subsequently signed off on the company’s accounting while making reference to the material weakness.

Investors shuddered over the revision, driving AIG’s stock down 12 percent. Mr. Vickrey, whose firm grades companies on the credibility of their reported earnings, gave the company an F. Mr. Sullivan, his credibility waning, was forced out months later.

The Losses Grow

Through spring and summer, the company said it was still gathering information about the swaps and tucked references of widening losses into the footnotes of its financial statements: $11.4 billion at the end of 2007, $20.6 billion at the end of March, $26 billion at the end of June. The company stressed that the losses were theoretical: no cash had actually gone out the door.

“If these aren’t cash losses, why are you having to put up collateral to the counterparties?” Mr. Vickrey asked in a recent interview. The fact that the insurer had to post collateral suggests that the counterparties thought AIG’s swaps losses were greater than disclosed, he said. By midyear, the insurer had been forced to post collateral of $16.5 billion on the swaps.

Though the company has not disclosed how much collateral it has posted since then, its $447 billion portfolio of credit-default swaps could require far more if the economy continues to weaken. More federal assistance would then essentially flow through AIG to counterparties.

“We may be better off in the long run letting the losses be realized and letting the people who took the risk bear the loss,” said Bill Bergman, senior equity analyst at the market research company Morningstar.

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Seems the Bailout money was wasted on AIG. They obviously don’t know how to run a business. I guess they will be begging for more money in the near future. The Welfare bums strike again.

I guess they need another big party the last one wasn’t large enough to satisfy them.

How Britain’s banks will never be the same again

By Sean Farrell

October 9 2008

The party’s over. Yesterday’s extraordinary set of Government measures to bolster the banking system will change how the sector operates, firmly closing the door on the era of excess in the financial industry.

After more than a year of telling the banks to put their own houses in order, the authorities were finally forced by tumbling share prices and seizure in the money markets to come to the industry’s rescue.

There will be the widely expected industry-wide recapitalisation, with the big seven banks plus Nationwide boosting their safety buffers by about £25bn this year.

But the most important elements were the doubling of the Bank of England’s Special Liquidity Scheme to £200bn and the acceptance of a wider range of collateral and – especially – the Government’s offer to guarantee up to £250bn of their debt. Lack of liquidity was the biggest concern for the banks and if increasing their capital ratios is the price they have to pay for the Government’s largesse then so be it.

The initial £25bn capital boost would take the big eight’s average tier one capital ratio from 9.1 to 10.3 per cent, Keefe Bruyette & Woods analysts calculate. All the big lenders have agreed to get their capital ratios up to the required level, but not necessarily by taking the Government’s money.

HSBC, Abbey Santander and Standard Chartered all said they were participating, but that they would either raise the money internally or in the market. Barclays is also understood to believe it can raise the money from existing investors by issuing preference shares on the same terms the Government would have demanded.

But whether or not they take the Government’s money – paying a reported coupon of 9-12 per cent – the banks will have to hold more capital and will face greater scrutiny of their business risk by the Financial Services Authority, which is throwing its weight around after being caught napping during the boom years.

The Government has not set a common ratio, and instead the FSA will negotiate with – or tell – individual banks about what levels of capital they should hold. They will also have to pay more for the Government’s guarantee of their debt if their business models are judged to be risky – another incentive to toe the line.

Is this the socialisation of the banking system? Not really. But the measures will add to existing pressures that will constrain banks’ businesses and reshape the sector.

Alex Potter, banking analyst at Collins Stewart, says the Government’s drive to improve capital ratios is correct and has echoes of banking regulation under the Bank of England when each bank was given guidance over its capital levels. That system gave way to a free-for-all in recent years where both the level and quality of banks’ capital buffers was allowed to slip as lenders lent more and more against their reserves, moved assets off balance sheet and replaced top-notch shareholder equity with new debt instruments.

“The Government is taking more interest in the banking system and is saying if you want access to these funds you will have to run less risky business models. I’m not sure we are going back to a more boring banking system, but we are going to a system that is not going to get any more interesting,” Mr Potter says.

Banks used to act simply as middle men between depositors with excess funds and borrowers who wanted to buy houses or invest in their businesses. This “maturity transformation” plays a vital role in the economy by using short-term funding for longer term purposes.

But to boost profitability in what is naturally a mature, slow-growth banking market, Britain’s lenders spent the last 10 years gearing up their balance sheets. This meant expanding lending massively and using the booming wholesale markets to offload assets and raise fresh funds. Northern Rock securitised mortgages and used short-term funding to the point where only a quarter of its loans were supported by old-fashioned deposits. Banks with big corporate and markets arms, like Royal Bank of Scotland, expanded in leveraged lending and parcelling up mortgages into structured products that could be sold to investors.

The Government wants to be seen to be bringing the banking industry into line after the years of excess. Shareholders and bosses will be penalised while ordinary taxpayers will be rewarded. The Government said it “will need to take into account dividend policies and executive compensation practices and will require a full commitment to support lending to small businesses and home buyers”.

Paul Niven, head of asset allocation at F&C, says the Government intervention was inevitable and welcome in the short term but that the longer-term implications for the sector are less rosy.

“Banks will have to operate within a much tighter framework. What kinds of loans are they going to have to make and to which businesses and on what criteria? Will it be profitable lending? What is the benefit to a lot of these banks that have investment banks which have generated large profits on the back of proprietary trading? Maybe it is not in the taxpayer’s interests to have them punting their balance sheets around.”

Simon Gleeson, a partner at the law firm Clifford Chance, argues that in the furore over the Government’s capitalisation and liquidity plans the market has missed the more important changes lurking in the banking reform Bill, published yesterday. Because retail depositors will take precedent over commercial lenders to a troubled bank, UK banks will have a far higher cost of borrowing in commercial markets.

“What we end up doing is breaking up the industry,” Mr Gleeson says. “You will have deposit takers which do little else but take deposits and make personal loans, and separate unregulated or lightly regulated entities which do what used to be called investment banking. The 1980s have been declared a mistake.”

The change could threaten the universal banking model in the UK, which is back in fashion in the US after JPMorgan bought Bear Stearns and Merrill Lynch was forced to sell itself to Bank of America. The main British banks that will have to grapple with this problem will be Barclays and Royal Bank of Scotland, which have built up large debt-focused investment banks on top of their core retail banking activities.

Experts warn the Government’s intervention could backfire if it does not secure a similar response from other major global regulators in a new international settlement for the financial system. Giorgio Questa, professor of Finance at Cass Business School, says: “The Government is trying to get political mileage out of using the taxpayer to make good for their mistakes in the last 10 years. They have been abysmal in the conduct of supervision and now they want to interfere again. If England tries to do its own regulation separately from global regulation, it can kiss goodbye to London as a global financial centre.”

Bosses’ pay to be curtailed

After years of cosying up to the City of London, the Labour Government is clamping down on pay in the banking sector. The Treasury said explicitly yesterday that the authorities would look at banks’ pay when deciding whether to support banks with capital injections.

Financial authorities in the US and the UK believe the high pay and bonus culture at banks contributed to the sector’s reckless practices by offering massive rewards for short-term profit. Bonuses in the millions for chief executives and traders alike helped turn the stolid industry of banking into a casino of proprietary trading, overstretched balance sheets and warehousing of dodgy securities.

Those practices created massive profits for banks in the boom years but many have now lost all the gains and the wider economy is paying the price. Yet though their companies may have gone to the wall or come close to oblivion, individual bankers have kept the bonuses that rewarded their excess.

Sir Fred Goodwin, the chief executive of Royal Bank of Scotland, earned £4.1m last year, including a bonus for the bank’s acquisition of ABN Amro, which the bank now admits it overpaid for. Andy Hornby, the boss of HBOS, earned £1.9m in 2007 but his bank was forced to sell itself to Lloyds TSB last month to avoid going bust.

Lloyds own chief executive, Eric Daniels, was paid £2.4m last year.

The Prime Minister said yesterday that the Financial Services Authority would draw up a code covering executive pay at the banks. The move will formalise measures announced earlier this year when the FSA said it would include pay schemes when assessing the riskiness of a bank’s business model.

Watchdogs already exercise control over pay in regulated industries such as the energy sector, Stella Brooks, director at Inbucon, the pay consultant, says. It is easier for those regulators because they control pricing and companies know that excessive pay can be punished with lower prices.

Banks are also more complicated because their chief executive’s pay is often vastly outstripped by earnings of top traders or merger advisers. The most high-profile disclosed bonus in the City is that of Bob Diamond, the president and investment banking chief at Barclays. Mr Diamond earned £250,000 in salary last year but was paid a £6.5m cash bonus, with share options taking his total remuneration to £18.5m.

Peter Hahn, a fellow at Cass Business School, argues that changing banks’ pay structure to ward against short-term excess is simple. Simply align chief executives’ pay more closely to risk and they will do the rest of the work to make sure they get a bonus at the end of the year.

The banks have insisted for years that they operate in international markets and that their chief executives are in constant danger of being poached by US banks for far higher rewards. But that argument is harder to make with banks in the US reporting massive losses and a big backlash against excessive pay and pay-offs for chief executives.

“If banks try to use that argument now, that is when the regulator turns round and says, ‘Fine’,” Ms Brooks says.

Critics of the Government have said that its claim to be clamping down on City pay is political posturing that will be conveniently forgotten because the country relies on financial services’ pay to drive the economy and provide tax revenue. The Centre for Economic and Business Research has forecast that City-type bonuses will fall to £5bn this year, from £8.5bn in 2007. That spells bad news for the UK’s finances, which CEBR calculates could have received about £3bn from last year’s bonus pool.

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Published in: on October 9, 2008 at 11:11 am  Comments Off on How Britain’s banks will never be the same again  
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