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from Breakingviews:

UK banks have much to fear from latest probe

By Chris Hughes

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The latest competition review of UK banking should aim to be the last. An antitrust probe in 2000 led to limited price controls after concluding that British lenders made excess profit. There were two more big investigations after the financial crisis. Yet concerns about market inefficiencies persist. That suggests the Competition and Markets Authority should do something radical this time.

The CMA says it is minded to conduct a comprehensive investigation of UK banking later this year. The industry is at least as oligopolistic as it was 14 years ago. Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland have 77 percent of personal accounts and 85 percent of small-business banking.

So-called challenger banks have emerged from disposals by Lloyds and RBS as mandated by the European Commission. But the market has become more concentrated, especially in mortgages, after Lloyds swallowed Halifax and Bank of Scotland and several former building societies collapsed. Customer dissatisfaction is high. Yet just 4 percent of SME customers and 3 percent of personal customers switch accounts annually. The banks say things are already changing for the better. Twas ever thus.

from Breakingviews:

Barclays’ HQ move talk puts regulators on the spot

It should come as no surprise that New York Mayor Mike Bloomberg welcomes the idea of Barclays moving its headquarters to Manhattan. It would be a prominent feather in his cap in the long-standing feud with London over who is the dominant global financial center. But U.S. regulators would be unlikely to match the mayor's warm welcome.

Barclays executives are considering making the Big Apple their new home if UK capital charges end up going too high. If it weren't for the financial crisis, such a move would be little more than a matter of lost tax revenue and national pride. But it would be the most glaring example yet of global regulatory arbitrage. It would also be ironic: U.S. banks have been complaining that new rules in last year's Dodd-Frank Act give Europeans the upper hand. And JPMorgan Chief Executive Jamie Dimon said in a speech on Wednesday that he feared U.S. bank capital requirements could end up more onerous than elsewhere.

from Funds Hub:

Utilities vs banks: The evidence

Alpesh Patel caused quite a stir on Britain's Radio 4 this morning. The CEO of boutique investment house Praefinium Partners argued that Bob Diamond was on "a suicide mission to bring down capitalism". No word yet from the Barclays CEO on that one.

Maybe that was just the line his PRs had promised to the BBC producers to get him on air, though, and there is more logic to Patel's more substantial point about value creation in the banking sector in relation to bonuses and pay.

Is Barclays paying its bankers too much?

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A Barclays sign is seen outside a branch of Barclays bank, in central London in this file picture. REUTERS/Toby Melville  

Barclays top-two — Chief Executive John Varley and President Bob Diamond — declined their 2009 bonus for the second year in a row, although the bank is paying the 23,000 staff at its investment bank £191,000 per head on average. The bank had a record year, but said all bonuses to its Executive Committee would be deferred, as it reacts to widespread criticism on bankers’ pay.

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from Commentaries:

Now watch banks slither round the bonus curbs

Marcus Agius, the immensely wise chairman of Barclays, told a Spectator conference this week that his board paid "as little as we can get away with" to the hotshots under his command, but that to get the best, he had to pay the going rate.

Asked from the floor whether the (reported) 500 million dollars paid to Dick Fuld before the collapse of Lehman Brothers meant that he was the best, Agius could only mumble that he didn't know Mr Fuld.

Banks score own goal with bonus culture defence

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In the blink of an eye it look as if the City is “booming” again after Barclays and HSBC announced buoyant investment banking earnings on Monday.

Both banks were hit by a surge in bad debts as the recession took its toll on borrowers, but analysts said that resurgent debt and foreign exchange trading and market share grabbed from troubled rivals fuelled the largely positive results.

from The Great Debate UK:

Barclays’ conjuring trick

-- Margaret Doyle is a Reuters columnist. The opinions expressed are her own --

REUTERSAbracadabra! Yet again, Barclays has pulled another rabbit out of its hat. With just days to go before the end-March deadline for the bank to apply for a government guarantee of its dodgier loans, it may again wriggle out of state control.

The Financial Services Authority (FSA) has concluded, after performing "stress tests" on its loan book, that the bank has enough capital. Barclays (BARC.L) has persuaded the authorities and investors (shares are trading at over three times their January low) -- of its soundness.

Blame or redemption for Christians in financial crisis?

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Does being a Christian make you a better banker? Former Bank of England employee John Ellis raised the possibility during a church discussion in London on the financial crisis.

The Treasurer of the United Reformed Church pointed to the relative stability of HSBC — despite market speculation about its capital adequacy — compared with the parlous state of some of its rivals.

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