Bank exodus 'could damage London'

Private banking professionals who are currently deliberating moving their businesses to more tax-friendly locations could spell disaster for London, according to one expert.

Michael Baxter, economics analyst at Investment and Business News, claimed that bankers are ’vilified’ in the UK and new regulations being brought in by the government could encourage some financial institutions to move operations abroad.

’There is a danger that this might happen, Goldman Sachs have said they may well leave the country. It is a hazard, genuinely,’ Mr Baxter warned.

However, he added that private banking firms have no obligation to London and that the City has a lot of work to do if it is to retain its image as the financial capital of the world and remain attractive for investors.

Chancellor Alistair Darling recently announced in his Pre-Budget Report that banks offering individual bonuses of more than £25,000 to their employees would face a 50 per cent temporary payroll tax.ADNFCR-2318-ID-19543561-ADNFCR