While most attention is paid to the financial crisis in the US, the global recession’s impact on the U.K. has also been deep and severe.
David Cameron, British Prime Minister, will meet with leaders of New York’s financial sector to discuss regulation, while also encouraging further investment in Britain. It may be a tough sell, given the U.K. bonus tax, and new alternative markets emerging around the globe.
On his first trip to the US since coming to power in May, Cameron is set to meet with Jamie Dimon of JPMorgan Chase (NYSE: JPM), Lloyd Blankfein of Goldman Sachs (NYSE: GS), Vikram Pandit of Citigroup (NYSE: C), and a few others. The banks are seen as a key driver in the U.K. economy, and amid the flurry of regulatory and market changes, Cameron is seeking a receptive audience to help push his domestic economic agenda. As unemployment continues to soar in the U.K, incremental investment from the banks leading to more jobs can go a long way to growing his popularity at home.
Cameron’s spokesman told reporters “There’ll be a discussion of regulatory proposals. He will set out our plans for financial regulation.” Perhaps this discussion will also focus on how the U.K. bonus tax has diverted shareholder profits in the second quarter in each of the major banks as well. The spokesman said the prime minister was also eager to encourage banks with large amounts of cash and “substantial investments” in Britain to continue that flow of capital.
The London economy has grown dependent on financial services, and the new regulations implemented risks destabilizing that revenue and job base. Although the banks may be vilified by mass media, their business remains vital to the local economy. Cameron’s meetings could go a long way to restoring the relationship with the banking sector for London.
