Sector: Finance

As banks on both sides of the Atlantic square up to legislative moves not only to tax bonuses but also to force the splitting off of retail banking from investment banking, some banking chiefs have broken ranks and admitted that their critics have a point. Stephen Green, chairman of HSBC, whose Far Eastern and international franchise helped insulate it from the worst of the sub-prime loan crisis, has hit out at the ‘inflated’ level of some bonuses.

On the eve of the World Economic Forum at Davos, Green attacked the ‘distortion’ created by bonuses ‘paid off gross income, first-day profits and without any capital charge’.  Wall Street giants Goldman Sachs and J.P. Morgan have bowed to public indignation in the UK by cutting the ratio of London pay to revenue from 50 per cent to between 30 and 40 per cent, with Goldman capping payments to its top London staff at £1 million each.

Among the insurers, acquisitive non-life run-off specialist Randall & Quilter Investments is buying JMD Specialist Insurance Services for £2 million. The AIM-quoted company is paying £1.3 million in cash and shares.