Tuesday newspaper round-up: HSBC, Lloyds, Cotton...

HSBC is considering a controversial plan to base its next chairman in Hong Kong in a move that could mark a turning point in the international bank's relationship with Britain. HSBC is looking at whether it can hand the chairman's role to Michael Geoghegan, its chief executive, who relocated to Hong Kong in March, the Times reports.Eric Daniels, the American chief executive of Lloyds Banking Group, will retire next year, marking the final departure of a boss who steered a British bank through the financial crisis. Mr Daniels has mended fences with shareholders after Lloyds's controversial acquisition of its stricken rival HBOS in September 2008. Yet many have maintained that the bank still needed a clean break from the past, the Times reports.The Energy Secretary backed plans to increase environmental levies by £15 bn to free hundreds of thousands of people from income tax. He is already drawing up proposals for the proportion of government revenue raised by environmental taxes to jump from 7.7% to 10% within five years, from £35bn annually to around £50bn. The increase is equivalent to an extra £800 from every taxpayer, the Telegraph reports.The Arab states of the Gulf have embarked on one of the largest re-armament exercises in peacetime history, ordering US weapons worth some $123bn as they seek to counter Iran's military power. A package of US arms worth more than $67bn for Saudi Arabia accounts for the largest single component of this military build-up, providing a huge boost to the American defence industry, the FT reports.The number of Britons convicted of tax cheating has fallen sharply over the past three years, The Times has learnt, raising questions over the Government's determination to target tax evaders. Danny Alexander, Chief Secretary to the Treasury, announced radical measures to tackle tax avoidance at the weekend, promising to raise prosecutions five-fold over the next four years, the Times reports.Royal Bank of Scotland came a step closer to exiting its controversial energy-trading venture yesterday as RBS Sempra offloaded its North American electricity assets to Noble Group for $317 million in cash. Noble, a worldwide commodities trader, will also assume $265m (£170m) of debts for Sempra Energy Solutions, which markets electricity across 16 American states, the Times reports.Microsoft has moved to counter Apple's dominant position in digital music by unveiling a new online service that is pitched between Spotify and iTunes. However, the software giant will not launch a standalone music player to compete with the iPod in Europe, as it does in the United States, where it sells the Zune HD. Instead, it will rely on the success of its mobile phone partners, such as HTC and Samsung, the Times reports.Standard & Poor's and Fitch have both granted the Eurozone's rescue fund a AAA credit rating, clearing the way for swift action if needed as the region's debt crisis threatens to erupt again. Goldman Sachs warned clients of a "measurable risk" that both Ireland and Portugal may have to tap the €440bn European Financial Stability Facility (EFSF), though "probably only early next year" since both countries have adequate funding for several months, the Telegraph reports.One of the world's premier rating agencies yesterday backed the UK's economy by maintaining its top credit rating, despite fears that the Government's cuts could send the country into a double-dip recession."Despite a weak post-crisis balance sheet and challenging economic outlook, the UK is able to meet these challenges whilst maintaining its Aaa credit rating," Moody's Investors Service said. It added that the UK also retained a stable outlook, the Independent reports.Clothing retailers, hit last week by a raft of disappointing economic data, were left reeling again yesterday when cotton prices exceeded the $1-a-pound barrier for the first time in 15 years. Contracts for December delivery jumped by nearly 4% to $1.0198 in New York yesterday, and were later matched by prices in Asia. The increases are the market's reaction to limited supply, largely as a result of the devastating floods that have hit a number of countries in South Asia in recent weeks, strong demand, and inventories being run down, the Independent reports.The longest US recession since the Great Depression officially ended in June 2009, the body charged with dating US business cycles said on Monday. The National Bureau of Economic Research said that the recession lasted 18 months, from December 2007 to June 2009. That was longer than the 16 months of the 1973-75 and 1981-82 recessions, the FT reports.