Congratulations to Finsbury on winning the Royal Bank of Scotland PR account. A clue as to where the plum contract might be heading came when Finsbury didn't repitch for the Lloyds Banking Group business.

Finsbury's boss, Roland Rudd, who is close to several Government ministers, is also not unknown to the new brooms at RBS. He advised chairman Sir Philip Hampton when he chaired Sainsbury's and chief executive Stephen Hester when he was running British Land.

* Bailed-out US bank Citigroup, in a bid to defend its decision to spend $10 million (£6.8 million) on new offices for its bosses, pointed out that the cost of the revamp has been reined in. Apparently, plans for a Zen garden were axed...

A report back from Sir Stuart Rose's presentation at the Retail Week convention last week indicated the Marks & Spencer king "fell very, very flat".

* And as another row with shareholders looms over Rose's joint - chief executive and chairman - roles at Marks & Spencer, sales continue to stall and the share price drifts well below 300p, the City talk is that Sir Philip Green of Bhs is thinking of dusting off his wallet again. Green says not, but that doesn't stop the rumours continuing to circulate...

* The best way to fix the poor image of collapsed insurance giant AIG? Er, hide. First, the firm sent out a memo to staff with advice after concerns “due to a growing sense of public attention fueled by increased media scrutiny”. Advice included the nugget that it might be best to “avoid wearing any AIG apparel” and “ensure any badges with the AIG insignia are not readily visible when out of the office”. Now it's gone a step further — taking down the large AIG logo on the building housing one of its offices in New York. It looks like at least part of the company will be rebranded AIU. The firm's chief executive Edward Liddy told a House of Representatives subcommittee: “I think the AIG name is so thoroughly wounded and disgraced that we're probably going to have to change it.” Yes, but can a leopard really alter its spots?

Return of the Paulson zombie

US economist Paul Krugman on the Timothy Geithner $1 trillion bailout plan: “A zombie idea is an idea that you keep on killing, because it's a bad idea, but it just keeps on coming back. And [that's] what this is — we've had this idea since Henry Paulson came out with his plan six months ago, [in] the Bush administration, that the real problem is that the market is undervaluing all of these toxic assets, and what we need to do is have taxpayers go in and buy them at a fair price, and that will solve all of our financial problems. And that's what happened. The Geithner plan is a complicated, disguised variant on the same idea. It's the zombie that you keep killing, and it just keeps coming back.”

* Bill Gross, chief investment manager at US bond fund Pimco, describes the toxic asset bailout as a “win, win, win” scheme. He means for him, of course. Goldman Sachs is also in favour. As is Warren Buffett. Hmmm...

The wheels come off for Oleg

Alas Oleg Deripaska, once reckoned to be Russia's richest man. He has been forced to reduce his stake in struggling aluminium giant Rusal, while he has gone cap in hand to the UK Government to bail out his British vanmaker LDV.

Now though, City Spy hears that there have been redundancies nearer to home as he has cut to the bone the household staff at his mansion in St George's Hill near Weybridge and at his Belgrave Square townhouse. Even the full-time chauffeur has gone...

* The word from ITV is that director of corporate affairs Mark Gallagher has been put in charge of the broadcaster's cost-cutting programme. That has raised a few eyebrows since under his tutelage the corporate public relations department has grown in size from three people to 17. It is now about to go back down to seven with many of the departing flaks too recently appointed to have earned redundancy money. The status of all the external consultants and advisers Gallagher has brought in remains to be seen. Gallagher was brought in by Michael Grade, the ITV chief, 18 months ago after the two worked together at lottery firm Camelot.

A sobering look at way banks work

How banking functions — the European way. Heidi is the owner of a bar in Berlin. To increase sales, she decides to allow her loyal customers, most of whom are unemployed alcoholics, to drink now but pay later.

She keeps track of the drinks consumed on a ledger (thereby granting the customers loans). Word gets around, and as a result, increasing numbers of customers flood into Heidi's bar. Taking advantage of her customers' freedom from immediate payment constraints, Heidi raises her prices for wine and beer, the most-ordered beverages.

Her sales volume increases massively. A young and dynamic customer service consultant at the local bank recognises these customer debts as valuable future assets, and increases Heidi's borrowing limit.

He sees no reason for undue concern since he has the debts of the alcoholics as collateral. At the bank's corporate headquarters, expert bankers transform these customer assets into Drinkbonds (DBs), Alkbonds (ABs) and Pukebonds (PBs). These securities are then traded worldwide. No one really understands what the abbreviations mean or how the securities are guaranteed. Nevertheless, as their prices continuously climb, the securities become top-selling items.

One day, although the prices are still climbing, a risk manager (subsequently, of course, fired because of his negativity) of the bank decides the time has come to demand payment of the debts incurred by the drinkers at Heidi's bar. However, they cannot pay back the debts. Heidi cannot fulfil her loan obligations and claims bankruptcy.

DBs and ABs drop in price by 95%. PBs perform better, stabilising in price after dropping by 80%. The suppliers of Heidi's bar, having granted her generous payment due dates and having invested in the securities, are faced with a new situation. Her wine supplier claims bankruptcy, and her beer supplier is taken over by a competitor.

The bank is saved by the government following dramatic round-the-clock consultations by leaders from the political parties.

The funds required for this purpose are obtained by a tax levied on the non-drinkers.