Kay: Investment bankers are 'powerful oligarchs'

LONDON: Investment bankers are wielding their political influence to override popular support for legislation to break up lenders' trading and retail operations, economist John Kay said.

"You have a group of politically powerful oligarchs, whom other people hate, but who are entrenched there," Kay, a visiting professor at the London School of Economics, said in an interview. "It will require something of a political earthquake" to reduce the bankers' sway, he said.

Bank of England Governor Mervyn King said in September that a debate on the structure of banking is needed and described an article by Kay as "the most important piece written on the subject in 10 years". King also cited Kay as he argued in a speech last month for splitting retail operations from investment banking.