UK banks and insurance companies that are hoping to grab customers in the rest of Europe to boost profits are unlikely to succeed for at least 10 years, according to an independent financial consultancy. The report pinpoints language barriers, different tax regimes, financial regulations and varying behaviour of customers as the hurdles that companies have still not managed to overcome.It is disparaging of efforts by Britain's biggest banks such as Barclays and Lloyds TSB to get a foothold on the Continent, saying that, particularly in central and Eastern Europe, they fall behind rivals such as Italian banks. Following its failure to buy domestic rival Abbey National last year, Lloyds has made it known that it is once again interested in a major European deal but has so far made no headway.CGNU, which is renaming itself Aviva to sound more European, and French insurer Axa have tried to penetrate the Continent by buying a series of businesses. But First Consulting says they have not achieved the "Coca Cola level of simplicity". Unlike the US soft drink giant, which uses the same recipe in every country, financial institutions run their subsidiaries as separate companies. "Overall they have reaped little scale advantage while bearing the quite sizeable costs of complexity," the report says.The research predicts that it will take at least a decade for banks and insurers to crack the most complex aspect of European integration, which is finding a uniform way to sell financial products to customers in different countries.Plans to free up Europe's pension funds moved a step nearer yesterday when European Union finance ministers reached broad agreement on rules to allow funds to operate across borders.

Ending an 18-month impasse, ministers backed, in principle, a compromise drafted by the Spanish EU presidency saying that fund managers could market their product abroad, subject to minor investment restrictions.. Hewlett-Packard plans to squeeze $500m (£350m) of extra cost savings from the acquisition of its rival Compaq, and set a deadline of shedding 15,000 staff by the end of next year. The company had predicted the acquisition would generate $2bn in cumulative cost savings by the end of 2003 and $2.5bn in 2004. Carly Fiorina, chief executive of Hewlett-Packard, said the company now expects to save $2.5bn by 2003 and $3bn the following year.The upgrade is partly due to the fact that Hewlett-Packard believes its plans to shrink the workforce by a tenth can be achieved more quickly than it expected.

Ms Fiorina said: "We think moving faster on headcount reductions is good for employees, particularly when it reduces uncertainty."The job cuts largely are being carried out through voluntary retirement rather than layoffs. The charges from paying compensation, closing facilities duplicated by the merger and other costs associated with the deal are expected to total $2.1bn.Ms Fiorina said technology customers were still cutting back spending. Sales in the second half of the year will be between $35bn and $36bn, about $2bn below the total made by the two companies in the same period last year.She headed off criticism about her pay at a time when Hewlett-Packard is cutting so many jobs. She said she would not take an increase in salary until after employees received increases, which would not be until the company had finished implementing redundancies.. Sir Geoff Mulcahy wants to "do a Philip Green" and make millions buying up an undervalued asset, close friends of the Kingfisher chief executive say. They say he has been fascinated by the success of Philip Green, who paid just £200m for Bhs two years ago and has transformed the high street retailer into a company worth close to £1bn.