Barclays president Bob Diamond today identified government mandates as one of the biggest growth areas in investment banking in the next two years, adding that dramatic changes to the competitive landscape have left fewer banks "well placed to respond to clients' needs for deep, global relationships".

Diamond, speaking at a Barclays investor seminar in New York, said: "Government work will be one of the biggest growth areas. In the near term, that will be on the distressed asset programme front, while in the medium term it will be debt issuance.