Speculations are that the banking and finance giant JP Morgan might be seriously considering dropping pans of building a new 1.5 Billion Pounds headquarters in London, mainly on the back of the Government's new bonus tax and much tougher than before City regulations.

Chief Executive of JP Morgan, Jamie Domin has supposedly expressed much anger at the latest 50% tax on bonuses which the Government has decided it will impose, with the aim to curb the amount of bonuses that particularly financial institutions pay to their top management.

Also, Mr. Dimon is reportedly much concerned about the Financial Services Authority's probe into executive pay.

The investment bank is currently in the process of constructing new European headquarters in Canary Wharf, but a clause in the firm's contract with Songbird Estates, the developer, gives it the option to back out of the deal before 2010 comes to a close.

"There were no threats made on the call (to Chancellor Darling) and we have made no decisions on people or buildings based on the super-tax announcement", a JP Morgan executive has been quoted as saying.

"Alistair Darling regularly discusses this type of issue with senior executives. The tax on bonuses is a fair measure because no bank would be left standing without Government intervention", a Treasury spokesperson said.