The CEOs of Barclays, RBS, HSBC, Lloyds and Santander UK are scrambling to make sure a peace deal between the government and their banks isn’t derailed, the FT reported.And the operation to battle against a government conquest has been dubbed Project Merlin by the bank heads.
But the problem is that the banks who launched the offensive are starting to second guess the deal.
Standard Chartered abandoned the campaign weeks ago; HSBC “is known to have reservations,” and Santander has only a handful of highly paid i-bankers anyway.
Plus that bank has already stepped up its lending, so signing up isn’t necessarily going to get them a whole lot.
Apart from bonuses, bank chiefs are trying to finagle more leniency over a whole range of issues, and want explicit assurances that the environment for doing business will be “stabilised.”
CEOs want a guarantee that:
A) There’ll be no new taxes, on top of the $4 billion balance sheet levy
B) That ministers won’t launch another roud of “banker bashing” when bonuses are announced in the spring
One weekend report [said] that the project was already dead – but even the sceptics admitted the attempts to revive it could work. “It’s struggling, but it’s still alive,” said one banker.
Bankers’ hopes for a ceasefire on bonuses with the government have been complicated by confirmation of a new framework on pay, authored by the CEBS, the pan-Europe regulator, which could limit top bankers’ cash bonuses to 20 per cent of total remuneration.
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