Are we killing investment banking? And if we are, should we care?

Do we really mean to kill investment banking, or are we trampling it by accident in a fit of righteous zeal? By ‘we’ I mean politicians, regulators and public opinion, and by ‘kill’ I mean rendering it unattractive or unviable for any shareholder-owned financial business except on the most limited scale — and as uncertain a career choice as, say, Liberal Democrat politics or freelance journalism.

The announcement last week of a radical scaling back of Barclays’ trading and deal-making arm has stoked a debate that had been smouldering for some time; for background reading, I recommend recent articles by Philip Augar in the FT and Frances Coppola in Forbes. In essence, the British and European presence in the investment banking arena is shrivelling fast, the titans of Wall Street are feeling the chill, and the future lies with partnership-owned boutique providers of specialist skills, meeting the needs of savvier clients.