David Prosser: The bankers are fighting back everywhere you look

It is becoming clearer by the day that Bob Diamond meant exactly what he said when he told MPs thetime for remorse from bankers was over

If you think the value of Bob Diamond's bonus package for 2010, at £6.5m, is a sign that Barclays has heeded calls for restraint – he was, after all, tipped for a £10m payday – take a look at the rest of the detail on remuneration provided by the bankyesterday. A £39m windfall for the bank's top five executives (excluding traders with no managerial responsibilities, who may have got even more) is not the stuff of which restraint is made. Or is the £3.85m handed to John Varley, Mr Diamond's predecessor in the chief executive's office.

Note, too, that we do not yet have details of what Barclays paid the taxman last year, which will be revealed on Friday when the bank publishes its annual report. Having paid only £113m of corporation tax in 2009 – not bad for a business that made £4.6bn, even if half that profit was generated outside of the UK – it would be nice to hear the Treasury's coffers are now asfortunate a beneficiary of the bank's largesse as its executives. But don't bet on it.

It is becoming clearer by the day that Mr Diamond meant exactly what he said when he told the Treasury Select Committee that the time for remorse from bankers was over. He is not the only banker in the mood for mounting a fightback. Look at HSBC, for example, which continues to fail to put a stop to the gossip that it will pull its headquarters out of the UK this year. It tells us it doesn't want to, before complaining, not so sotto voce, about the cost of doing business in this country.

Even Standard Chartered is at it. Peter Sands, the chief executive of the bank, which has previously sailed along loftily above the financial crisis, was busy dropping hints last week that it, too, might have to reconsider its UK domicile. In the City, meanwhile, the gossip doing the rounds is that the banks, led by Mr Varley, came within a whisker of securing a promise from the Chancellor that in return for them signing up to the Project Merlin he had been publicly championing, his Independent Commission on Banking would not recommend their break-up.

With George Osborne desperate for a deal on Merlin for political reasons, it is said to have taken the threat of resignation from the commission's directors to torpedo this pact.

No wonder that Mervyn King, the Governor of the Bank of England, felt compelled to speak out so aggressively against the banks over the weekend. And even then, it was striking how angry and public the response from the City was – with the sort of vituperative attacks on Mr King's calls for reform that most bankers would not have dared mount even six months ago.

In part, the banks' return to the fray is motivated by their determination to head off the threat from the commission. Better to seek to prevent it making unpalatable recommendations, they reason, than to challenge them once they arrive. But there is something else going on, too. The banks smell weakness from the Chancellor, whose record is evidence of where his sympathies are.

First, Mr Osborne announced a bank levy that was much smaller than the City feared (and compensated for by a corporation-tax cut). Then he watered down the new disclosure rules, so that the banks have not been, after all, forced to name their highest earners. And now he appears, for political reasons, to have been seeking to do deals that prejudge the commission's findings.

In other words, while the banks' biggest critic is about to be handed more powers to regulate the sector, Mr King is losing the battle for the Chancellor's ear. By the time he gets his hands on a new regulatory toolkit, what additional concessions will the bankers have won?



Only two cheers for John Lewis's new bond

Also in line for decent bonuses this week are the 75,000 employees of John Lewis. The department store is due to announce what it is to pay its "partners", with a windfall of upwards of 15 per cent predicted following an excellent – though not quite record-breaking – year of trading in 2010.

To augment its reputation for social enlightenment, John Lewis has also announced plans to raise £50m from customers and staff through a "Partnership Bond", eschewing the City, to which firms normally turn for raising money, and instead paying its stakeholders for providing it with finance.

This is all very worthy, of course, but there is a catch: while John Lewis generally prides itself on being "never knowingly undersold", in this case it has been.

At first sight, the offer of a 6.5 per cent annual return from the bonds looks excellent, even taking into account that almost one-third of that will be paid in John Lewis or Waitrose vouchers. Remember, however, that the returns are taxable, so basic-rate taxpayers will get only 5.2 per cent a year, falling to 3.9 per cent a year for higher-rate taxpayers.

Compare this with the bond issued by Tesco last month, which raised £125m in the blink of an eye. It paid only 5.2 per cent as a headline rate (all cash, though, and no voucher), but crucially, unlike the John Lewis offering, it was a full-fledged corporate bond. As a result, savers are allowed to hold it within an individual savings account (Isa) and shelter returns from tax. It also means that Tesco bondholders can cash in their holding whenever they wish, since it is tradable on the London Stock Exchange's new retail corporate bond market, while John Lewis's investors are locked in for five years. With interest-rate rises ahead, locking into a fixed rate today could prove to be an expensive mistake.

Let's not be curmudgeonly. Unlike at Barclays, there is no debate about whether John Lewis partners deserve their bonuses. Similarly, its Partnership Bond is a creditable effort to draw customers further into the business. Just don't fall for the hype completely – your money may work harder elsewhere.

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