Bank shares soar despite George Osborne's apparent 'crackdown'
Monday 08 July 2013
Investors piled into Britain’s biggest banks today as the City saw little to fear in Chancellor George Osborne’s apparent crackdown on the financial sector.
Royal Bank of Scotland, Lloyds and Barclays also surged up the FTSE 100 amid reports that Singaporean investment fund Temasek and a consortium led by former Standard Chartered chief executive Lord Davies are among buyers eyeing a swoop for a major chunk of the taxpayer’s 39% stake in Lloyds.
The Government’s official response to the Parliamentary Commission on Banking Standards endorsed criminal changes and the threat of jail for “reckless” bankers. But the Chancellor threw out attempts by the Commission to lift leverage ratios — the amount of equity they hold as a share of their balance sheets — beyond the 3% minimum planned under incoming Basel III rules.
Raising the leverage ratio would increase costs for banks although the Commission was concerned that the 3% level was “too low”. The Commission had also pressed for the Bank’s financial policy committee to have the power to set leverage ratios and condemned the Government’s decision to delay a review of this potential move until 2017. The report said “the leverage ratio is a complex and technical decision best made by the regulator and it should certainly not be made by politicians”.
Barclays shares added 6.8p to 298.3p today, Royal Bank of Scotland roared 12.5p higher to 289.3p and Lloyds added 1.76p to 66.38p.
Despite the Chancellor’s refusal to budge on the leverage ratio, the Chancellor said the bank would work with regulators to ensure bankers’ pay is aligned with their performance.
The Chancellor said: “Cultural reform in the banking sector marks the next step in the Government’s plan to move the whole sector from rescue to recovery and ensure that UK banks demonstrate the highest standards, and are able to support business and drive economic growth.”
Business Secretary Vince Cable added: “If we’re to get our economy back on track, we need to get the banking system back on track first. Creating new powers to jail bankers who are reckless with other people’s money and getting more competition into banking is a start.”
- 5 How the language you speak changes your view of the world
Lucy Hawking: Stephen Hawking's daughter writes impassioned open letter to Katie Hopkins about rights of disabled people
Indonesia executions: Death row British grandmother Lindsay Sandiford will refuse to wear a blindfold when she faces firing squad
Oxygen-starved 'dead zones' with no marine life up to 100-miles long discovered in the Atlantic Ocean
How the language you speak changes your view of the world
Russian warships accused of 'chasing away' Swedish vessel to prevent Baltic States from achieving energy independence
Over 50,000 families shipped out of London boroughs in the past three years due to welfare cuts and soaring rents
EU asylum policy is 'a direct threat to our civilisation', says Nigel Farage
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: SNP and its activists 'openly racist' towards the English, Farage says
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
Schools forced to act as 'miniature welfare states' with teachers buying underwear and even haircuts for poor pupils
iJobs Money & Business
£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...
£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...
£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...
£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...