:00:04. > :00:09.Another day, another scandal, as British banking is rocked by yet
:00:09. > :00:19.more controversy. Four of the UK's big banks are found to have mis-
:00:19. > :00:23.sold complex financial products to thousands of small businesses.
:00:23. > :00:27.is unbearable. I feel like I have lost my dignity. We have had to beg
:00:27. > :00:30.and borrow to keep up with the payments. It is like a rope around
:00:30. > :00:33.my neck. The head of the Bank of England
:00:33. > :00:40.accuses the banks of shoddy treatment of customers and of
:00:40. > :00:43.deceit. Everyone understands that something went very wrong with the
:00:43. > :00:47.UK banking industry and we need to put it right.
:00:47. > :00:49.And after the chaos for customers last week caused by a computer
:00:49. > :00:52.glitch, the head of RBS turns down his bonus.
:00:52. > :00:54.Also tonight: Germany gives way at the EU summit
:00:54. > :00:57.to help Europe's troubled economies, but is it enough?
:00:57. > :01:01.After yesterday's torrential rain and flooding, the clean up begins
:01:01. > :01:05.in parts of England and Scotland. An apocalyptic vision, as wildfires
:01:05. > :01:10.in the US state of Colorado force tens of thousands to flee their
:01:10. > :01:20.homes. Roger Federer scrapes through,
:01:20. > :01:26.
:01:26. > :01:31.after coming close to his worst And coming up in Sportsday on the
:01:31. > :01:34.BBC News Channel, another late night thrill on Centre Court at
:01:34. > :01:44.Wimbledon. Roger Federer is taken all the way by France's Julien
:01:44. > :01:52.
:01:52. > :01:55.Good evening. The governor of the Bank of England,
:01:55. > :01:57.Sir Mervyn King, has launched an outspoken attack on British banks
:01:57. > :02:04.for "excessive compensation, shoddy treatment of customers and
:02:04. > :02:07.deceitful manipulation of interest rates". His comments came after yet
:02:07. > :02:09.another banking scandal emerged today, the mis-selling of complex
:02:09. > :02:14.financial products to small businesses, which left some facing
:02:14. > :02:17.big losses. Today, another bank boss, Stephen Hester of RBS, said
:02:17. > :02:26.he was turning down his bonus, following the recent problems with
:02:26. > :02:30.the bank's computer systems. Robert Peston reports.
:02:30. > :02:35.For Britain's banks, there has been a week like it since they almost
:02:35. > :02:41.went bust in October 2008. First, Royal Bank of Scotland was unable
:02:41. > :02:45.to update the accounts of 17.5 million customers. Then Barclays
:02:45. > :02:48.admitted to try to read interest rates, and today all four big banks
:02:48. > :02:53.have been found guilty of serious failings in the way they sold
:02:53. > :02:58.complicated products to small businesses. Something went very
:02:58. > :03:05.wrong with the UK banking industry and we need to put it right. From
:03:05. > :03:07.excessive levels of compensation, to shoddy treatment of customers,
:03:07. > :03:15.to the deceit for manipulation of one of the most important interest
:03:15. > :03:19.rates, and now this morning to news of yet another mis-selling scandal.
:03:19. > :03:25.One of the Small Business victims of this mis-selling scandal is this
:03:25. > :03:29.woman. Berkeley's MACRO sold her of butchers a complicated product
:03:29. > :03:35.designed to limit on the ability to interest rate movements. --
:03:35. > :03:38.Barclays. But it has landed her with �76,000 of charges over a year.
:03:38. > :03:43.It is awful. It is literally killing us, to the point that it is
:03:44. > :03:47.unbearable. I feel like I have lost my dignity. We have had to beg and
:03:47. > :03:52.borrow to keep up with payments. It is like a rope around my neck, and
:03:52. > :03:56.I just feel I am going to get strangled at any moment. She and
:03:56. > :04:00.other small businesses may be able to cancel the deals and get some
:04:00. > :04:04.money back, following a settlement arranged by the City watchdog.
:04:04. > :04:07.of the products were the right products at the right time. Some of
:04:07. > :04:12.the products were the wrong products for the wrong customers.
:04:12. > :04:17.We want the banks to differentiate between those two, stop selling
:04:17. > :04:20.complicated products to people who cannot possibly understand them.
:04:20. > :04:24.Labour's leader things that we need another big banking inquiry, this
:04:24. > :04:28.time into the allegedly defective culture of the banks. We have to
:04:28. > :04:31.make sure we shine the light in all the corners of the banking industry
:04:31. > :04:36.to understand why are these practices have been going on and
:04:36. > :04:40.what it is about the culture that has enabled that to happen.
:04:40. > :04:44.Government is not saying definitely No. We know what needs to be done,
:04:44. > :04:48.let's get on and take those actions. I have enumerated a number of them
:04:48. > :04:53.in terms of accountability, regulation, taxation, transparency,
:04:53. > :04:57.behaviour, punishment for things that are done wrong. On every one
:04:57. > :05:00.of those, action is required. for the bankers, they are queuing
:05:00. > :05:06.up to turn down bonuses that have not yet been awarded, to show that
:05:06. > :05:11.they are sorry. It is inappropriate for me to have a bonus this year.
:05:11. > :05:14.We have let our customers Downham. That may have arisen from old
:05:14. > :05:19.systems and things that were before my time but we could reasonably be
:05:19. > :05:23.expected to improve things. expect our banks to do four simple
:05:23. > :05:27.things. Keep our money saved, learn what the economy needs, process
:05:27. > :05:32.transactions and stay honest. Over the past few years and days, they
:05:32. > :05:36.have failed in all fundamental respects, many would argue. Time to
:05:36. > :05:39.get back to basics? It is an argument I increasingly here.
:05:39. > :05:43.Our political correspondent Norman Smith is at Downing Street. There's
:05:43. > :05:51.lot of talk among MPs about punishing banks and holding them to
:05:51. > :05:55.account, but what can the Government actually do? Well, the
:05:55. > :05:59.Government would say that they have already taken steps, but the
:05:59. > :06:03.difficulty in changing the culture in something as vast and diverse as
:06:03. > :06:07.the City is that it is inevitably a protracted and slow process. So the
:06:07. > :06:11.Government have already put in place measures to split up banks
:06:11. > :06:15.into their retail and investment arms, ring-fencing of the risk-
:06:15. > :06:19.taking element, but that is not due to come into force until after the
:06:19. > :06:23.next general election. They have looked to curb cash bonuses, but
:06:23. > :06:25.many bankers still seem to receive huge financial rewards. And the
:06:26. > :06:29.Government is looking at legislation to ensure traders who
:06:29. > :06:33.fiddle interest rates will go to jail. The difficulty is that that
:06:33. > :06:36.is an incremental process, at a time when the public is breathing
:06:36. > :06:40.down the neck of ministers demanding, in effect, that heads
:06:40. > :06:45.roll now. And that sentiment is gaining political expression
:06:45. > :06:48.through growing calls for a Leveson-style inquiry into the
:06:48. > :06:53.banks. Interestingly, the Prime Minister is sceptical about such a
:06:53. > :06:57.move but he has not ruled it out. Why? Because he is acutely aware of
:06:58. > :07:02.the level of public anger towards the banks, and he knows that in
:07:02. > :07:04.order to assuage it, he may yet, down the line, have to concede such
:07:05. > :07:07.an inquiry. European leaders have insisted
:07:07. > :07:11.they've achieved a "real breakthrough" at the latest summit
:07:11. > :07:13.to tackle the eurozone debt crisis. The latest plans would allow bail
:07:14. > :07:17.out funds to lend directly to troubled banks, something Germany
:07:17. > :07:21.had previously resisted. While Chancellor Merkel is facing
:07:21. > :07:31.criticism at home for performing a U-turn, the markets have, so far,
:07:31. > :07:31.
:07:31. > :07:36.welcomed the move. From Brussels, Gavin Hewitt reports.
:07:36. > :07:40.During 15 hours of negotiations, it was the German Chancellor, Angela
:07:40. > :07:44.Merkel, who blinked first. Under enormous pressure, she made
:07:44. > :07:51.concessions, putting more of her taxpayers' money on the line to
:07:51. > :07:55.support the euro. It was Italy and Spain who lined up against her, two
:07:55. > :07:58.countries struggling with huge borrowing costs. The Italian Prime
:07:58. > :08:02.Minister, Mario Monti, said he would not leave the summit without
:08:02. > :08:07.a deal, he would block of the discussions. Finally, Angela Merkel
:08:07. > :08:15.agreed to be more flexible over bail outs and to accept direct hope
:08:15. > :08:19.for the banks. -- accept direct help. Italy has put a lot of
:08:19. > :08:23.pressure at the negotiating table for this to be achieved. What was
:08:23. > :08:27.in the deal? The bail out fund will be able to help the banks directly,
:08:27. > :08:32.rather than going via government and increasing their debt. But only
:08:32. > :08:36.after a powerful banking supervisor is in place. And extra flexibility
:08:36. > :08:43.for the bail out funds to buy government bonds and so force down
:08:43. > :08:46.borrowing costs. The Spanish had big smiles, and the Italian Prime
:08:46. > :08:50.Minister claimed double satisfaction, his country having
:08:50. > :08:54.beaten Germany at the football. In future, Italy would be able to
:08:54. > :08:58.access bail out funds without tough austerity conditions. Back home,
:08:58. > :09:02.some said Chancellor Merkel had suffered a painful defeat. She said
:09:02. > :09:08.she had been able to make concessions because she had won
:09:08. > :09:11.tighter controls over the banks. TRANSLATION: When you have a
:09:11. > :09:15.meeting late into the night, there is a certain risk. We are under
:09:15. > :09:19.pressure from the financial markets and people find themselves in a
:09:19. > :09:24.very complicated situation. So we had a shared interest to find a
:09:24. > :09:32.solution. In Germany, there were demands for Chancellor Merkel to
:09:32. > :09:37.explain what was described as a 180 degree U-turn. Germany alone cannot
:09:37. > :09:41.pay for all the countries. We are not so strong. In some years, we
:09:41. > :09:47.all will regret what happens now. And then it will be too late.
:09:47. > :09:51.was another clear message out of this summit. In order to save the
:09:51. > :09:55.single currency, the euro is moving towards much closer integration.
:09:55. > :10:00.Economic union, banking union, political union. The UK will not be
:10:00. > :10:03.part of those changes, but they pose real challengers. That change
:10:04. > :10:08.has consequences for Britain. My job is to make sure that we secure
:10:08. > :10:12.all the safeguards that we need, so that our role in the European Union,
:10:12. > :10:18.hour access to the single market, our say in the single market is
:10:18. > :10:22.properly safeguarded. Summits have come and gone. This was the 19th.
:10:22. > :10:27.But power in Europe has shifted. The Germans are more isolated.
:10:27. > :10:35.Italy and Spain have found an ally in France. Time has been bought,
:10:35. > :10:39.but a comprehensive solution to the debt crisis is a long way off.
:10:39. > :10:44.I am joined by Stephanie Flanders. Germany has compromised the little
:10:44. > :10:47.bit. Politicians are claiming a breakthrough. Is it? You know I am
:10:47. > :10:52.not going to say it is a solution to all of the eurozone's problems.
:10:52. > :10:56.It is not that kind of crisis, and it was not that kind of summit. One
:10:56. > :11:01.of the reasons that the markets reacted favourably to this today is
:11:01. > :11:04.that the brief statement released late last night has a hint of
:11:04. > :11:07.progress in two important areas which do matter to financial
:11:07. > :11:11.investors and will make it easier for governments to feel they are
:11:11. > :11:14.responding to this crisis in the short term. One is the admission
:11:14. > :11:18.that you can give money to a troubled eurozone bank without that
:11:18. > :11:21.money adding to the debt of the government of that country. That is
:11:21. > :11:24.going to be very important, but as Gavin suggested, it will only
:11:24. > :11:29.happen when you have moved to a European banking union with a
:11:29. > :11:32.single bank supervisor. Important in principle, but it could take a
:11:32. > :11:35.long time to achieve and in the meantime we do not know what will
:11:35. > :11:39.happen to countries like Spain and their banks. The other point, the
:11:39. > :11:43.issue that the rescue funds might find it easier to invest, to move
:11:43. > :11:48.into the financial markets and hope financial markets, countries
:11:48. > :11:50.directly with their borrowing costs. -- help them. That would be great
:11:50. > :11:54.for investors if they thought it was going to happen, but there is
:11:54. > :11:57.no sign that there will be any more financial backing for the rescue
:11:57. > :12:02.funds to make that intervention really effective, from the European
:12:02. > :12:05.Central Bank, for example. So there are still a lot of details to iron
:12:05. > :12:08.out. But certainly the hint, and the exception of a principle that
:12:08. > :12:12.things really could be quite different in future.
:12:12. > :12:16.It's the second wettest June in the UK since records began and we
:12:16. > :12:20.haven't got to the end of the month yet. If it carries on raining it
:12:20. > :12:23.could break the record. That will come as no surprise to homeowners
:12:23. > :12:26.and businesses who've spent the day clearing up and counting the cost
:12:26. > :12:29.after the storms which battered parts of England and Scotland last
:12:29. > :12:32.night. And there's been more disruption on the railways today
:12:32. > :12:42.after flash floods left thousands of passengers on the East Coast
:12:42. > :12:46.
:12:46. > :12:51.Main Line stranded. Danny Savage So much rain fell here in North
:12:51. > :12:56.Tyneside that the water just ran through people's homes. It turned
:12:56. > :13:01.residential streets into torrents. You did not need the car, you
:13:01. > :13:06.needed a boat. Some make the most of conditions. How about a canoeing
:13:06. > :13:10.course in the back garden? What a difference 24 hours can make it!
:13:10. > :13:15.The water has gone. Most people living here except the damage was
:13:15. > :13:21.caused by freak weather conditions. They have the long and drawn-out
:13:21. > :13:25.task of trying out their homes and dealing with insurers. Nobody had
:13:25. > :13:32.time to get things to safety but everybody had something to say
:13:32. > :13:38.about the storm. It was the end of the world. It was Armageddon. I had
:13:38. > :13:44.never seen the sky quite so black. I was driving and you could not see.
:13:44. > :13:48.Dozens of schools were closed as many classrooms ended under water.
:13:49. > :13:54.On the rail network, thousands of people had their travel plans all
:13:54. > :14:01.journeys disrupted, to the dismay of some here in Edinburgh. Absolute
:14:01. > :14:03.chaos! Engineers have got those routes linking Scotland and England
:14:03. > :14:12.open again today but not before some passengers had to endure
:14:12. > :14:22.marathon journeys. 15 and a quarter hours to travel from London on a
:14:22. > :14:22.
:14:22. > :14:28.train. Fire, at Rail and landslides. I have been seven hours on the
:14:28. > :14:32.train. All these problems were caused by short-lived but violent
:14:32. > :14:38.storms. Where there experts say the conditions yesterday were some of
:14:38. > :14:46.the most severe and Mashable in the UK. More than 100,000 lightning
:14:46. > :14:53.strikes were detected. -- imaginable. It was the wettest
:14:53. > :14:56.April to June period on record, according to the Environment Agency.
:14:56. > :14:59.A prisoner, who scaled the walls of Pentonville Jail and escaped on
:14:59. > :15:02.Wednesday, has been arrested by police. John Massey, a convicted
:15:02. > :15:12.murderer, was found at an address in Faversham, Kent. A second man
:15:12. > :15:13.
:15:13. > :15:16.was arrested on suspicion of helping him escape. There has been
:15:16. > :15:18.more heavy fighting and reports of a fresh massacre in Syria tonight,
:15:18. > :15:21.on the eve of a major United Nations conference in Geneva.
:15:21. > :15:24.Opposition activists claim dozens of civilians have been killed in a
:15:24. > :15:27.suburb of Damascus. Tonight, the US Secretary of State, Hillary Clinton,
:15:27. > :15:29.is meeting her counterpart in Moscow to try to agree a diplomatic
:15:29. > :15:39.response. Our correspondent, who has reported extensively on the
:15:39. > :15:41.
:15:41. > :15:48.conflict, has the latest. Artillery pounds a suburb of Syria's capital.
:15:48. > :15:54.This is 20 minutes' drive from the presidential palace, yet in rebel
:15:54. > :15:59.hands. The regime is trying to seize it back. After the shelling,
:15:59. > :16:05.say activists, militia men arrived to kill people one at a time. In
:16:05. > :16:10.this house, the bodies of men, women and children are piled up -
:16:10. > :16:16.three generations. In a rare interview, President Asad gave his
:16:16. > :16:19.backing to the United Nations peace plan. There was no mention of the
:16:19. > :16:24.UN ceasefire that goes with it. The responsibility of the Syrian
:16:24. > :16:30.government is to protect all our residents, he said the start that
:16:30. > :16:36.means the responsibility to annihilate terrorists. -- he said.
:16:36. > :16:45.The United States says Mr Assad must go. Hillary Clinton needs the
:16:45. > :16:49.agreement of Russia. That can be difficult. Despite what the Russian
:16:49. > :16:57.Foreign Minister says, so far Moscow is continuing to give
:16:57. > :17:03.President Assad its diplomatic and ministerial support. If so, that is
:17:03. > :17:06.bad news for the UN peace plan and its author, Kofi Annan. He is
:17:06. > :17:10.meeting the permanent members of the Security Council in Geneva
:17:11. > :17:19.tomorrow. It is starting to look like a last-ditch effort to save
:17:19. > :17:22.the plan. There is no Plan B, no alternative to the UN process.
:17:22. > :17:29.Members of the Security Council tried to resuscitated here tomorrow.
:17:29. > :17:32.The violence in Syria has escalated throughout a series of
:17:32. > :17:38.international initiatives. President Assad has made it clear
:17:38. > :17:42.he is prepared for a fight to the finish and is expecting a long war.
:17:42. > :17:50.Coming up on tonight's programme: The woman who would be president of
:17:50. > :17:54.Iceland, with her baby, on the campaign trail. Icelandic women
:17:54. > :18:04.have always worked a lot, no matter how many children they have had.
:18:04. > :18:06.
:18:06. > :18:09.Tens of thousands of people in the American state of Colorado have
:18:09. > :18:12.been forced to flee their homes as wildfires sweep across the area.
:18:12. > :18:14.More than 1,000 firefighters have been deployed to fight the blaze,
:18:14. > :18:24.which is now threatening the state's second largest city,
:18:24. > :18:29.
:18:29. > :18:34.Colorado Springs. From thousands of miles above the Earth, smoke pours
:18:34. > :18:42.into the sky. Colorado it is burning. The flames have flicked
:18:42. > :18:47.ever closer to the second city, Colorado Springs. 30,000 people
:18:47. > :18:51.have been evacuated. Searing temperatures and whipping winds
:18:51. > :18:57.have provided the perfect conditions for the blaze. I were
:18:57. > :19:01.standing outside my apartment. You could see the fire down the hill.
:19:01. > :19:05.Already, homes have been turned into little more than piles of cash.
:19:05. > :19:10.Some residents were given just minutes to abandon their homes and
:19:10. > :19:15.nearly all their possessions. love my home, I love the area we
:19:15. > :19:20.live in. To think that all of that is gone is so heart-wrenching.
:19:20. > :19:26.After declaring a major disaster and releasing federal aid to the
:19:26. > :19:31.state, President Obama flew to Colorado. He saw how fire had
:19:31. > :19:36.consumed some houses, left others untouched. The President was struck
:19:36. > :19:41.by the reach of the fire. devastation is enormous. Our
:19:41. > :19:47.thoughts and prayers go out to all the families who have been affected.
:19:47. > :19:52.When natural disasters like this happen, America comes together. We
:19:52. > :19:58.all recognise that there for the grace -- but for the grace of God
:19:58. > :20:04.go I. After six days of distraction, firefighters say they are getting
:20:04. > :20:14.to grips with more and more of the blaze. For the first time, there is
:20:14. > :20:19.
:20:19. > :20:22.a cautious note of optimism. It depends which way the weather turns.
:20:22. > :20:25.She is a journalist and former game show host who gave birth just a
:20:25. > :20:28.month ago but, tomorrow, Thora Arnosdottir will find out whether
:20:28. > :20:31.she's been elected President of Iceland. The country has seen women
:20:31. > :20:33.rise to some of the most senior positions in the wake of the
:20:33. > :20:36.economic collapse, as voters turn against male politicians. Our
:20:36. > :20:40.correspondent joined Thora Arnosdottir - and baby - on the
:20:40. > :20:46.campaign trail. While some mothers with a month old baby struggled to
:20:46. > :20:50.get out of the house first thing, she is dressed and ready to
:20:50. > :20:56.campaign by 8:30am. Her husband is in charge of the baby today. That
:20:56. > :21:01.means she can refine her message to potential voters. It means spending
:21:01. > :21:06.hours in a Mini van driving through the Icelandic countryside. It is
:21:06. > :21:11.far from glamorous. She talks to the work force in a fish factory
:21:11. > :21:18.and managers to grab some breakfast. Then and our old people's home. A
:21:18. > :21:24.small group but in a country where the population is 320,000, any size
:21:24. > :21:32.audience is welcome. She feeds her baby girl in the van but she does
:21:32. > :21:37.get one proper stock. We have both been working full-time. We managed
:21:37. > :21:41.to be really good parents at the same time. That will not change.
:21:41. > :21:49.Icelandic women have always worked a lot, no matter how many children
:21:49. > :21:54.they have had. That does not change. No matter what the job is called.
:21:54. > :21:59.Iceland is progressive when it comes to women in top positions.
:21:59. > :22:02.Followed -- following the Icelandic banking crash, many of the male
:22:02. > :22:09.politicians who fail to see it coming were voted out and replaced
:22:09. > :22:13.by women. The speaker of parliament is a woman. As is the Minister of
:22:13. > :22:19.Finance and the first female bishop has just been ordained. The person
:22:19. > :22:24.she is challenging his one of the only surviving men in a key role.
:22:24. > :22:32.There is a long list of high offices in Iceland in the last 25
:22:32. > :22:37.years that have been held by women. That is as it should be. They
:22:37. > :22:42.believe the President has become too political during his years in
:22:43. > :22:50.office. She wants to return the role to that of a figurehead above
:22:50. > :22:58.politics. If she wins, her husband will become a house-husband. I do
:22:58. > :23:02.not see myself as a lesser man. I can care for the baby and watch
:23:02. > :23:07.football. 12 hours on and she is still on the campaign trail. It is
:23:07. > :23:12.easy to forget that here in the land of the midnight sun, How Late
:23:12. > :23:18.It is. Getting out of the capital and into the sticks, is what she
:23:18. > :23:22.needs to do to win votes. It is difficult for anyone, let alone
:23:22. > :23:26.with a baby in tow. The Hollywood couple Tom Cruise and Katie Holmes
:23:26. > :23:30.are to file for divorce after five years of marriage. The pair married
:23:30. > :23:36.during a lavish ceremony in 2006. The split was announced by Katie
:23:36. > :23:39.Holmes' lawyer, who said it was a private matter for the family. It
:23:39. > :23:43.looked for a moment this evening like Roger Federer was going to go
:23:43. > :23:46.the way of Rafa Nadal as he came within two points of his worst ever
:23:46. > :23:49.defeat at Wimbledon. But he just managed to pull through to win in
:23:49. > :23:52.five sets. Meanwhile, yesterday's unexpected victor, Lukas Rosol, has
:23:52. > :24:02.found himself the new darling of the All England Club. Our sports
:24:02. > :24:04.
:24:04. > :24:10.correspondent reports. Sport tends to work best when it is
:24:10. > :24:16.unpredictable. In the match with Roger Federer, it came when his
:24:16. > :24:26.poise and serve was broken in the first set. Then the six-time
:24:26. > :24:27.
:24:27. > :24:35.champion lost the second to a not very famous Frenchman. Roger
:24:35. > :24:40.Federer donned his crime pons and began to inch back. He took the
:24:40. > :24:48.next two sets. With his opponent in pain from a leg injury, Roger
:24:48. > :24:57.Federer struck. It was a tough match! It was brutal. A bit of luck
:24:57. > :25:01.may be on my side. Earlier on centre court it had all been easier
:25:01. > :25:11.for of Agnieska Radwanska. She played Heather Watson. The match
:25:11. > :25:13.
:25:13. > :25:21.was over in under an hour. Last night, Rafael Nadal, the number two
:25:21. > :25:30.seat lost. Most of his fans would not have known who his opponent was
:25:30. > :25:37.before the match. He is the world No. 100. I did not realise what was
:25:37. > :25:42.happening. I was playing amazing yesterday. I have never seen
:25:42. > :25:52.someone look less intimidated by it Rafael Nadal. It is a little dream
:25:52. > :25:54.
:25:54. > :25:59.for me. That match last night was as big an upset as I have seen. It