Barclays Faces Trans-Atlantic Scrutiny
Along with an inquiry in London, some of the biggest financial institutions in England are now coming under scrutiny from Washington. Ben Bernanke, chairman of the Federal Reserve, told the US Senate that he could not guarantee that libor rates were no longer being manipulated. Al Jazeera's Barnaby Phillips reports from London.

Bank Shares Tumble on Obama Crackdown
TIMES ONLINE: Shares in Barclays and Royal Bank of Scotland (RBS) tumbled this morning after sharp falls on Asian markets in the wake of President Barack Obama’s pledge last night to wage war on American banks in the biggest regulatory crackdown on financial institutions since the 1930s.

Barclays’ shares fell a further 6 per cent to 266p this morning and are trading 14.4 per cent lower than at the start of the week. RBS, the state-owned lender, lost a further 4.45 per cent today to 33.75p.

London's FTSE 100 index of leading shares tumbled by 52.40 points to 5,282.81 in mid-afternoon trade, adding to yesterday's 85.70 point decline after the US President made his announcement.

There are fears that Mr Obama's proposals could force a radical restructure of American banks - a move welcomed by George Osborne, the Shadow Chancellor, who hailed Mr Obama’s intervention.

He said: “I have said consistently that we should look at separating retail banking from activities like large-scale proprietary trading — and that this was best done internationally. Coming on top of growing agreement on a bank levy, it shows that Conservatives are part of an emerging international consensus on these issues.”

The Treasury said that it would study Mr Obama's moves carefully.

The radical proposals would limit the size of institutions and bar them from the most cavalier trading practices. >>> Emily Ford | Friday, January 22, 2010

People Have Been Shot for Less Than This! Witness Nicolae Ceauşescu
Photo of Alistair Darling courtesy of The Telegraph
Alistair Darling, the Chancellor, has called for a change in the banking culture to stop executives being paid massive bonuses while presiding over failure.

Speaking as he announced an inquiry into banking bonuses, Mr Darling revealed that he had held talks with the Royal Bank of Scotland, which has received a £20 billion taxpayer bailout, to urge chiefs there to reconsider plans to pay out £1 billion to staff.

Meanwhile, George Osborne, the shadow chancellor, said that the banking industry should be told that "the party is over".

The Chancellor stressed that while incentive schemes may be appropriate in some circumstances, bonuses should only be paid in exceptional circumstances, to reward success rather than failure.

And he insisted that bankers responsible for the near-collapse of the financial system last autumn should not receive a bonus. Alistair Darling Urges Banks to Withhold Bonuses Amid Consumer Fury >>> By Rosa Prince, Political Correspondent | Sunday, February 8, 2009

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