Bloomberg reports that, according to a sale solicitation document, the funds managed for outside investors by Citigroup's energy trading unit, Phibro, rose 22% in 2008, compared with a 46.5% loss in the Standard & Poor's GSCI Index over the same period.

The unit delivered $667m in profits last year, but this has got lost, as the focus has been on the $100m compensation package likely to be paid out to trader Andrew Hall, who runs the business, and is responsible for its excellent results. And now, at a time when Citi is desperate to deliver sustainable earnings, it is being forced to sell Phibro, simply because Hall's potential payout is unpalatable to the US government, which happens to be the company's largest shareholder. This is madness, and just another example of how the Obama administration is more concerned with headlines and sound-bites than fixing Citi, and getting taxpayers off the hook.

Talking of tax and tax revenues, the UK government won't be getting much by way of personal taxes from HSBC CEO Michael Geoghegan, who is relocating to Hong Kong. That's what happens if you increase the tax rate to 50%, Gordon. The bank has said that it will continue to be domiciled in the UK, although the smart money thinks that the company is preparing the way to move to a low tax jurisdiction unless tax rates in the UK become more business-friendly in the near future.

In the meantime, The New York Post reports that highly-respected former Merrill Lynch executive Greg Fleming is ready to move back to Wall Street, following an 8-month stint in academia. Fleming is thought likely to re-emerge some time soon, and Barclays Capital, BlackRock and JPMorgan Chase are thought to be possible destinations.

The Wall Street Journal reports that Citi has sued Morgan Stanley for $245m, over what it claims is non-payment under a credit default swap purchased to protect a loan exposure in 2006. Morgan Stanley is said to have pocketed a $750,00 fee for the cover, but has apparently refused to pony up.

And Bloomberg also reports that Julius Baer's private bank is looking to hire up to 60 bankers a year, as it looks to grow assets in the near-term.

Finally, The Times reports that, as expected, G20 leaders have reached agreement about banker compensation without actually imposing a pay cap. Banks will, however, by required to set aside larger capital reserves by 2012 to safeguard against the possibility of future bail-outs, and firms will be expected to link compensation to long-term performance and move away from giving multi-year bonus guarantees.

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