London: down and out for Goldman Sachs

London's financial presence slipping?

Reports have warned that Goldman Sachs might be preparing to abandon London as a viable financial services centre after recent moves in the UK have introduced a windfall tax on bankers' bonuses, a new 50 percent top income tax rate, and increased banking regulations.

According to British newspaper The Telegraph, Goldman Sachs, which is the world's most powerful investment bank, has already examined various methods to get out of London: including uprooting entire teams, departments and divisions and rehoming them in offshore locations.

Currently in its early stages, the review could ultimately go either way, with some industry experts suggesting that it could also end up suggesting that no changes are made to Goldman's model.

The bank, one of the most profitable financial institutions in the world, saw a bumper financial year last year. It managed to set aside GBP£10.5 billion to cover pay and bonuses in the first three quarters of 2009 alone.

Now, whatever the outcome of the review, the UK government are likely to consider the review as a significant blow to their efforts to reignite passion about the City and their plans to sustain belief in England's capital as a global financial services centre.

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