OH, what clever folk those bankers are. But even with brains the size of Wales, they can sometimes be as gullible as a gap-toothed nine-year-old.

First, they fell hook, line and sinker for those dodgy American mortgages. Not long after sub-prime lost its lustre, they were won over by “triple-A” rated mortgages - almost as bad as sub-prime.

Last week, however, we saw the most worrying case of gullible banker syndrome on the online investor TV show iBall. It broadcast a story about the Queen’s plans to sell shares in four palaces to cover the £15m annual maintenance bills for the royal homes.

“This appears to make commercial sense for Her Majesty,” said the presenter Steve McDowell. He then outlined how institutional investors would be able to buy shares in Buckingham Palace, Windsor Castle, Sandring-ham House and Balmoral through Four Palaces plc. The float was scheduled for October.

Seems unlikely? Well, a quick glance at the date would have confirmed that this was indeed an April Fool hoax.

But guess who swallowed it? Yes, along with requests for more information from American magazines, a clutch of City bankers speedily registered their interest in buying stock.

Our spies tell us there was interest from the Queen’s own bank Coutts - which was presumably a bit miffed about not being informed - as well as the blue-blooded broker Cazenove.

Did they think that the Queen herself would do the roadshow? And what if an analyst went for a downgrade? Wouldn’t that be tantamount to treason?

- THE PRESSURES facing City boys seems to be putting the poor chaps on edge, if a brawl at a City bar is anything to go by. The incident occurred at the Revolution bar on Leadenhall Street and, by all accounts, this was a little more serious than a drunken skirmish. The bar’s trading licence was subsequently reviewed and the closing time brought forward from 3am to midnight. Embarrassing for all concerned - including the bar’s private-equity owner Alchemy, which recently spent £2m converting the former bank into “the ultimate destination for lovers of vodka”, offering no fewer than 30 flavours of the tipple. We can’t be certain that it was the watermelon-flavoured vodka that did the damage. But in today’s market conditions, it’s safe to wager that it wasn’t the 40-year-old single malt.

UBS’s Elvis comes to the rescue

IT is reassuring to see just how far UBS vice-chairman Richard Hardie will go to help the Swiss bank in its time of need.

After UBS posted a devastating first-quarter loss last week, what did Hardie do? He took time out to mount a robust defence of the bank’s sponsorship of the London Symphony Orchestra. “To pull out at a time like this would be terribly easy,” he said in a rousing presentation with the LSO, “but I would say that if we did that, our reputation would be shot.”

Hardie’s crusade to save UBS did not end there. In a deft move to bolster the bank’s crumbling reputation, he gave an interview to the London financial freesheet City AM. In this he spoke candidly about his favourite party piece - singing Love Me Tender dressed as Elvis.

UBS shareholders: you have absolutely nothing to worry about.

HERE’S an idea that should take off, in more ways than one. Pegasus, a company that produces “kit” helicopters - like kit cars but you end up with something that really flies - hopes to raise £2m through a listing on the Plus market.

The two-seater machines, which have taken 10 years to design, are expected to go on sale at about £60,000.

They look slightly different from regular helicopters because they lack a tail rotor blade, but are said to be easier to fly and to have a range of more than 200 miles.

Pegasus seems an unlikely name for a company making aircraft that count their lack of wings as a key design feature. But if the float gets off the ground, nobody will mind.

- YOU would think John Hutton, secretary of state for trade and industry (or business, enterprise and regulatory reform, to use his department’s snappy new title) would have enough on his plate sorting out Britain’s looming energy crisis and keeping commerce alive.

Yet the energetic Barrow & Furness MP has another project on the go - a book called Kitchener’s Men.

The story recounts the experiences of the King’s Own Royal Lancasters, the regiment recruited from the steelworks and shipyards of Furness during the first world war. The book will be launched later this month with a reception at the Ministry of Defence.

By all accounts it is a rattling good read – though some in Whitehall wonder whether Hutton’s interest in things military might give a hint to the mooted cabinet reshuffle after the local elections in May.

Might he find himself replacing Des Browne with the defence portfolio?

Mind you, Hutton might think wrestling with nuclear power is preferable to trying to solve the MoD’s budget crisis.

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