PM pledge over banking practises

Gordon Brown has renewed the pressure on former bank chiefs to give up huge pensions as he demanded a clean-up of the banking system to eradicate "indefensible" practises.

The Prime Minister launched a stinging attack on the role of banks in sparking the recession and warned that the Government was committed to examining "all the legal action necessary" to recoup pay-offs.

In a speech to Labour's National Policy Forum in Bristol, he said: "Some of the practices now being discovered in our banks are not only unacceptable, they are indefensible and they have got to be cleaned up now.

"Many of the bank executives who got banks into this mess have now left their jobs; the boards of failed banks have gone; the four most senior executives of HBOS and RBS have all now left their jobs; seven non-executive directors of RBS lost their jobs; the HBOS board has ceased to exist.

"And we are exploring all the legal action necessary to recover pension payments from people who received too much."

Earlier he had renewed his direct appeal to Sir Fred Goodwin, the former boss of RBS, to give up at least some of the £693,000 pension he is being paid at the age of 50, despite being widely blamed for leading the bank to disaster.

"I hope that even now Sir Fred will realise that when you record the biggest losses of any company in British history, there should be some recognition of that in the pension fund," Mr Brown said during a visit to a GP surgery.

In his speech, Mr Brown also set out his hopes that Britain and the US could "go further on co-operation" with the US in tackling the global downturn ahead of talks with new president Barack Obama in Washington next week.

On Friday night it was revealed that Lloyds Banking Group was examining pay-offs to former Halifax Bank of Scotland (HBOS) directors to check they had been paid no more than necessary.

Beleaguered HBOS announced annual losses of £10.8 billion as new owners Lloyds warned of a slide into the red for the combined organisation this year. HBOS's former head of corporate banking Peter Cummings, who was behind the risk-taking blamed for the losses, is believed to be one of those being most closely targeted.