Times business section leads with news that the BoE’s Financial Policy Committee (FPC) will today castigate the ‘big 4’ banks for failing to build up large enough capital buffer to cover overvaluations, misconduct costs and the shortfall caused by poor measurement of risk. The Committee is set to publish a paper detailing a £38 billion ‘black hole’ across the big 4 banks, and will demand lenders address the shortfalls. As if that wasn’t controversial enough, the report doesn’t break the costs down by individual bank, and assumes all lenders calculate risk in the same way, thereby tarring all of the big 4 with the same brush.
Ian King in the Times describes the decision as ‘biting the hand that lends’. He hopes the FPC give the banks an extended deadline to cough up the capital, otherwise it may drag down net lending at a time when the economy needs every penny available.
Traditional families with stay-at-home mothers have had to bear a heavier burden of taxation than what the Telegraph calls ‘the international norm’ since the coalition came to office. The average family with one worker and two children loses 28% of their wages in tax, compared to 26% before May 2010, according to a study by the OECD. By contrast, single people and their two earner couples have seen their tax bills fall since 2009.
Senior officials from the OBR have dealt a damning blow to the government’s new mortgage and housebuilding scheme, Help to Buy, by arguing it will only succeed in driving up house prices while having a nominal impact on housebuilding.
Recruitment, HR and employment
Brussels’ plans to cap fund managers bonuses is likely to eased after a member of the European Parliament leading the measures indicated he was willing to soften his position. This comes less than week after the EU announced plans to force fund managers to cap bonuses at a 1:1 bonus-to-salary ratio.