Fear about what government support has meant for the financial system reached fever pitch in the second week of December 2009, when UK chancellor Alistair Darling shocked banks with his plans for a super tax on discretionary bonuses. The punitive strike went much further than anyone had even anticipated, affecting all banks operating in the UK – both domestic and foreign – and going beyond banks in which the government is a major stakeholder.
The move has crystallised industry fears about government meddling in banks’ affairs, particularly at those in which governments hold significant stakes or who have participated in guarantee programmes.