The City in crisis:

How the City slickers lost their mojo

Sackings, stress, and suicide: today, it's hard to believe that the Square Mile was ever London's cockiest workplace. So can it get its groove back?

A gloom has descended on the City of London. Britain's financial services industry, the engine-room of the economy, is forecast to lose 30,000 jobs this year. Vast cash bonuses are a thing of the past. Businesses which thrived on excess have had to learn moderation. And rival financial centres from Switzerland to Singapore are threatening to steal more business.

Many will welcome such a comeuppance. But this isn't an isolated issue the rest of us can ignore. The billions the City has made since the 1980s have trickled down to the capital and beyond.

In a week-long series of articles starting today, we look at the state of Britain's financial services industry, the challenges it faces, whether it can ever recover – and whether we should care.

Back in the good old days, that distant time before anyone had heard of sub-prime mortgages or quantitative easing, The Coq D'Argent occupied a certain place in the City mindset, at least among a particular breed.

Its geography, right at the heart of the Square Mile at Number One Poultry was helpful, but it also has a stylish rooftop bar from where bankers could celebrate the day's victories in loud voices with expensive booze.

It was a place to swap gossip and at least pretend you were on the inside, that you were Bud Fox in Wall Street before he got stiffed by Gordon Gekko. Traders might entice you like this: "See you in The Money Chicken at six, sunshine. Bring that mate of yours. No, the good looking one."

From here, while the views were admired, traders did what they do best: talked themselves up. Outrageous brags were bragged, sordid tales were exaggerated and self doubt was for fairies.

If you could leave the nagging voices behind, stop yourself wondering if it could be fair that these characters should be so casually wealthy and just let go, it was a lot of fun, for a while, anyway.

No one calls the Coq D'Argent The Money Chicken any more. It's famous for rather different reasons than laughter and cash lately. In the last few weeks, two City workers have jumped to their deaths from the bar. Four have done so since 2007.

It's probably wrong to draw any link between the terrible decisions made by some desperately unhappy people and the wider mood around EC2, but the old Money Chicken crowd, whose humour always ranged from mawkish to black in any case, think it's not coincidental.

"We know how they felt," goes the line from the trading crew, and they don't smile when the say it. The City of London is miserable. There's not much trade being done so hardly anyone is making enough money to justify their salaries.

Sackings – always on the cards in a hyper-competitive environment – are brutal and regular. The number of City workers seeking treatment for stress and for alcoholism has soared, say clinics.

You can say that they deserve all this, and you might be half right, but even bankers are human – some of them – and their lives have as much or as little meaning as anyone else's.

The boss of one investment bank – a serious mover and shaker – says he tells his staff to be low key in all situations, especially if doing business outside London. "I say to them: remember people hate you. That's your starting point," he says.

From this position, there's no small amount of finger pointing and a certain remorse for how things used to be. Bruce Packard, a City analyst, says: "There is lots of cynicism about. The City used to be a self policing club. They drank at lunchtime – no one could have designed a CDO squared after lunch, but they were still vaguely competent in the afternoon. "Then with 'professionalism', competence improved, but there is now infinitely less trust around. People realised that it was in their best interests to make sure that sharp practice was frowned upon. It was conservative with a small c."

The number of recent rogue trading and insider dealing cases suggest that, if anything, there's more misbehaviour than ever as bankers fight to find ways to make a turn.

Packard adds: "It used to be that you could make enough money honestly – why would you take the risk of doing something dishonestly? I blame the Americans. Why the Americans? They have a culture of 'If it's legal, then we should do it'."

Magnus Wheatley, an old City hand, says one reason for the gloom is that no one is enjoying themselves. "The City seems a moribund, dead world, full of zombie middle-management and accountants. We mourn the loss of the great characters, the corporate raiders, the antic-crazed character brokers, the colour of the LIFFE traders, the long lunches, the legendary bar tabs and the strip club stories on a Friday morning. It's over."

Is this the worst time ever? "Yes," says Wheatley. "Worse than the 1990s but with nicer premises."

Fund manager Alan Miller elaborates on the theme: "Most years everyone in the City says it's the worst they have ever known – this year it is probably the closest to the truth. In almost every area, both revenues and profits seem to be under pressure.

"You will always get an investment banker managing to drum up a completely insane deal to executives blinded by the opportunity to run a bigger company with a bigger salary (see British Aerospace for details) – [but] these seems generally few and far between."

Trading activity is also low, so brokers are not earning great revenues from that either. And stock market floats are thin on the ground.

For things to turn round probably requires one or more of the following – a raging bull market (unlikely), an increase in mergers and acquisitions (possible, as company balance sheets are strong, but many chief executives are still nervous) and for the trend for more intensive scrutiny of overall fees and costs to subside (impossible).

Perhaps the problem, says Miller, is not that people don't get the City, but that they get it all too well. High fees, hidden costs, brazen conflicts of interest combined with unrivalled arrogance.

"What is required is a deep cleansing of people and practices and psyches, but this will not happen overnight if at all," says Miller. "It will inevitably lead to a loss of jobs, but then how many of these really had much point in the first place?"

So how does the City, once the pride of London, emerge from this moribund state? Wheatley says: "It's not going to be easy, and we've got at best another eight years to 2020 of public ridicule and mistrust. What's going to turn it around? Good professional handling of flotations and corporate fund-raisings, decent handling of individuals who entrust their money to us, fairer charging, transparent charging and a belief that running people's money whether private or corporate is a privilege, not a right."

Things may change. But probably not this much.

Life and Style
“What is it like being a girl?” was the question on the lips of one inquisitive Reddit user this week
News
peopleDave Legeno, the actor who played werewolf Fenrir Greyback in the Harry Potter films, has died
Arts and Entertainment
Armando Iannucci, the creator of 'The Thick of It' says he has
tvArmando Iannucci to concentrate on US show Veep
Life and Style
beauty
PROMOTED VIDEO
Sport
Luis Suarez looks towards the crowd during the 2-1 victory over England
transfers
Life and Style
Swimsuit, £245, by Agent Provocateur
fashion

Diving in at the deep end is no excuse for shirking the style stakes

Sport
German supporters (left) and Argentina fans
world cup 2014Final gives England fans a choice between to old enemies
Arts and Entertainment
A still from the worldwide Dawn of the Planet of the Apes trailer debut
film
News
peopleMario Balotelli poses with 'shotgun' in controversial Instagram pic
News
A mugshot of Ian Watkins released by South Wales Police following his guilty pleas
peopleBandmates open up about abuse
Sport
Basketball superstar LeBron James gets into his stride for the Cleveland Cavaliers
sportNBA superstar announces decision to return to Cleveland Cavaliers
Sport
Javier Mascherano of Argentina tackles Arjen Robben of the Netherlands as he attempts a shot
world cup 2014
Arts and Entertainment
The successful ITV drama Broadchurch starring David Tenant and Olivia Coleman came to an end tonight
tv
News
ebookA unique anthology of reporting and analysis of a crucial period of history
Sport
Four ski officials in Slovenia have been suspended following allegations of results rigging
sportFour Slovenian officials suspended after allegations they helped violinist get slalom place
News
14 March 2011: George Clooney testifies before the Senate Foreign Relations Committee during a hearing titled 'Sudan and South Sudan: Independence and Insecurity.' Clooney is co-founder of the Satellite Sentinel Project which uses private satellites to collect evidence of crimes against civilian populations in Sudan
people
Arts and Entertainment
Balaban is indirectly responsible for the existence of Downton Abbey, having first discovered Julian Fellowes' talents as a screenwriter
tvCast members told to lose weight after snacking on set
Life and Style
More than half of young adults have engaged in 'unwanted but consensual sexting with a committed partner,' according to research
tech
Life and Style
A binge is classed as four or more alcoholic drinks for women and five or more for men, consumed over a roughly two-hour period
tech
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

BC2

£50000 - £70000 per annum: Harrington Starr: Business Analyst Consultant (Fina...

Programme Support, Coms, Bristol, £300-350p/d

£300 - £350 per day + competitive: Orgtel: My client, a leading bank, is curre...

(Junior) IT Systems Administrator / Infrastructure Analyst

£28000 - £32000 per annum + pension, 25 days holiday: Ashdown Group: A highly ...

Finance Officer

Negotiable: Randstad Education Birmingham: Randstad Education are seeking a Fi...

Day In a Page

A History of the First World War in 100 Moments: Peace without magnanimity - the summit in a railway siding that ended the fighting

A History of the First World War in 100 Moments

Peace without magnanimity - the summit in a railway siding that ended the fighting
Scottish independence: How the Commonwealth Games could swing the vote

Scottish independence: How the Commonwealth Games could swing the vote

In the final part of our series, Chris Green arrives in Glasgow - a host city struggling to keep the politics out of its celebration of sport
Out in the cold: A writer spends a night on the streets and hears the stories of the homeless

A writer spends a night on the streets

Rough sleepers - the homeless, the destitute and the drunk - exist in every city. Will Nicoll meets those whose luck has run out
Striking new stations, high-speed links and (whisper it) better services - the UK's railways are entering a new golden age

UK's railways are entering a new golden age

New stations are opening across the country and our railways appear to be entering an era not seen in Britain since the early 1950s
Conchita Wurst becomes a 'bride' on the Paris catwalk - and proves there is life after Eurovision

Conchita becomes a 'bride' on Paris catwalk

Alexander Fury salutes the Eurovision Song Contest winner's latest triumph
Pétanque World Championship in Marseilles hit by

Pétanque 'world cup' hit by death threats

This year's most acrimonious sporting event took place in France, not Brazil. How did pétanque get so passionate?
Whelks are healthy, versatile and sustainable - so why did we stop eating them in the UK?

Why did we stop eating whelks?

Whelks were the Victorian equivalent of the donor kebab and our stocks are abundant. So why do we now export them all to the Far East?
10 best women's sunglasses

In the shade: 10 best women's sunglasses

From luxury bespoke eyewear to fun festival sunnies, we round up the shades to be seen in this summer
Germany vs Argentina World Cup 2014: Lionel Messi? Javier Mascherano is key for Argentina...

World Cup final: Messi? Mascherano is key for Argentina...

No 10 is always centre of attention but Barça team-mate is just as crucial to finalists’ hopes
Siobhan-Marie O’Connor: Swimmer knows she needs Glasgow joy on road to Rio

Siobhan-Marie O’Connor: Swimmer needs Glasgow joy on road to Rio

18-year-old says this month’s Commonwealth Games are a key staging post in her career before time slips away
The true Gaza back-story that the Israelis aren’t telling this week

The true Gaza back-story that the Israelis aren’t telling this week

A future Palestine state will have no borders and be an enclave within Israel, surrounded on all sides by Israeli-held territory, says Robert Fisk
A History of the First World War in 100 Moments: The German people demand an end to the fighting

A History of the First World War in 100 Moments

The German people demand an end to the fighting
New play by Oscar Wilde's grandson reveals what the Irish wit said at his trials

New play reveals what Oscar Wilde said at trials

For a century, what Wilde actually said at his trials was a mystery. But the recent discovery of shorthand notes changed that. Now his grandson Merlin Holland has turned them into a play
Can scientists save the world's sea life from

Can scientists save our sea life?

By the end of the century, the only living things left in our oceans could be plankton and jellyfish. Alex Renton meets the scientists who are trying to turn the tide
Richard III, Trafalgar Studios, review: Martin Freeman gives highly intelligent performance

Richard III review

Martin Freeman’s psychotic monarch is big on mockery but wanting in malice