"UK banks understand that stories about high pay and bonuses causes anger and concerns individuals. However, the big bonus culture is not in retail banking but investment banks. Most retail banks are weathering the economic downturn well and have not used any taxpayers money. We have always said that bonuses need to be tied to the long-term success of the business and cannot reward undue risk-taking. Working with our regulatory authorities, we believe the commitment we have now made to this principle is unequivocal and total.
"The UK's main banks have signed up to the Financial Services Authority's code on remuneration and they are the first banks in the world to commit themselves in full to the rules agreed at last month's G20 meeting. But for the agreement to be fully effective these rules must be implemented by all G20 members. Other countries now need to follow where the UK has led.
"Banks are committed to lending to businesses. New business lending is holding up with the stock of lending up four per cent on a year ago. UK banks will continue to support viable businesses and there is no overall reduction the availability of credit. However, as is normal in a downturn, demand remains low with businesses paying back loans and looking to other sources of finance."