City groups set to advise Darling

The City will have a new route to get their message across to Mr Darling

Chancellor Alistair Darling is to tap leading City figures for advice on how to maintain London's position as a pre-eminent global financial centre.

Mr Darling is setting up five working groups to examine issues vital to the financial sector such as methods of raising capital and regulation.

Citigroup boss Sir Win Bischoff will help lead a group looking at global competitiveness in financial services.

The move comes amid fears of thousands of job losses in the City.

Tough climate

Several leading global banks, which have their European headquarters in London, have already announced large job cuts as they deal with the fallout from the credit crunch.

At the same time, there are concerns that a prolonged economic downturn could threaten London's pre-eminence as a global financial centre at the expense of emerging centres such as Shanghai, Mumbai and Dubai.

Meeting monthly, a group jointly chaired by Mr Darling and Sir Win will examine key trends in financial services, such as the continuing impact of the credit crunch and its repercussions for the City, as well as relevant legislation and working practices.

It is vital it [the City] can respond to the rapidly changing nature of international financial markets Chancellor Alistair Darling

Other members of the group will include the heads of the London Stock Exchange, Lloyd's of London and the CBI as well as representatives from leading banks and regulators.

"The financial services sector provides more than a million jobs in the UK," Mr Darling said, announcing the initiative.

"It is vital it can respond to the rapidly changing nature of international financial markets, with major shifts in financial flows and players to growing centres of influence."

A second group, co-chaired by Financial Services Authority boss Hector Sants and City minister Kitty Ussher, will look at the efficiency of capital-raising procedures at a time when banks are having to raise billions of pounds in extra cash.

Ms Ussher will also chair a third group, alongside former City of London policy chairman Sir Michael Snyder, looking at the issues facing lawyers, accountants and other professional services businesses.

The make-up of other groups, focusing on insurance and wholesale finance, has yet to be announced.

All the groups will report back to a high-level committee set up by Gordon Brown in 2006 to promote the capital as a financial centre.