Bailout to change the face of banking

Financial services in Britain have changed forever after the state seized control of two of the country's biggest banks in an unprecedented £37bn bail-out that brings an end to the era of easy credit and bumper bonuses. By Philip Aldrick and Katherine Griffiths Gordon Brown and Alistair Darling Photo: LUKE MACGREGOR Economists forecast massive state regulation that will reduce the once buccaneering banking industry to little more than a utility, like gas and electricity. Restrictions on lending policies and tighter demands on risk management are expected to restrain growth and limit shareholder returns. "The world is going to be very different," said Willem Buiter, a former member of the Bank of England's Monetary Policy Committee. "Appropriately so, as the old system collapsed, having caused imprudent lending and encouraged... [read full story]