Bankers make estate agents look popular and so any government deal with bankers that
doesn’t involve kicking them is politically tricky. The Treasury, acutely aware of the politics of all this, are very keen to stress that the government ‘played hardball’ with
Barclays, HSBC, Lloyds and RBS in the Project Merlin talks.
The actual deal is not a bad one. The promised £10 billion pound increase in lending to small businesses is better than expected. On bonuses, the banks have got off relatively easily. But crucially the bonus pool will be smaller than last year and bank head’s bonuses will be dependent on meeting lending targets for small businesses.
John Varley was thanked by Osborne for his role in the deal in the Chancellor’s statement to the House. I suspect that the former Barclays CEO has done his chances of becoming the next Governor of the Bank of England no harm and quite a little good by spearheading Project Merlin.
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