Abigail with attitude: Will the UK be pleased to wave goodbye to Barclays and StanChart?
Recently, I had a delicious gossipy lunch with a well-placed mole. Mole put forward an interesting theory about the UK banking arena: “In the old days”, he intoned, “banks and investment banks were seen as wealth creators and a force for good. For every pound earned by a slick banker, four pounds would be spent in Porsche show-rooms, London restaurants and poodle parlours. Now banks are seen as a force for evil.”
Mole paused, licked his lips judiciously and continued: “I believe the UK authorities would welcome the departure of some of the big British banks that are still too big to fail and frankly a pain in the neck. The animosity towards Bob Diamond is extreme: he is viewed as epitomising the arrogance of the industry, showing little remorse or responsibility for the death spiral of 2008. The UK authorities would not be sorry to see Barclays headquartered in the United States. They are also prepared to lose Standard Chartered. That leaves HSBC, Lloyds and RBS, which makes the banking sector a more manageable part of the UK economy in terms of assets to national GDP. HSBC is unlikely to move its headquarters. Stuart Gulliver is smart and, long term, he recognises that there’s limited upside to being regulated by the Chinese communist party.” Mole is ferociously bright. I will be interested to see how things play out in the next few years.