Britain AAA rating threat; Barclays eyes US bank - papers

Fitch Ratings has delivered a serious blow to the credibility of the Government's budget plans, warning that Britain risks a loss of investor confidence and erosion of its AAA rating unless it maps out clear austerity measures.

Brian Coulton, the agency's head of sovereign ratings, said the UK has seen "the most rapid rise in the ratio of public debt to GDP of any AAA-rated country" and is courting fate with its leisurely plan to halve the deficit by the middle of the decade, writes the Telegraph.

"It is frankly too slow, a pedestrian pace. Why the UK thinks it has more time than other countries, we're not sure. This needs to be reoriented," he told the Fitch forum on sovereign hotspots. Full story...

BARCLAYS IS looking at buying a large US retail bank as it tries to rebalance its business away from a booming investment banking franchise.

According to people briefed on the plan, Antony Jenkins, the new head of Barclays' retail banking activities, is preparing a strategy paper that will go to the board in the next two to three months, writes the FT.

"Nothing is imminent but we're opportunistic," said one person close to the bank. "If we do something, we will do it big."

Barclays has not identified firm targets for a US retail bid or begun any talks, according to people close to the bank. But bankers and analysts point to the likes of Sun Trust, PNC Financial and US Bancorp - all bailed-out US banks - as potential targets. Full story...