A Scottish Parliament inquiry will investigate how badly Scotland's global reputation in the banking and financial sectors has been damaged by the actions of its big banks, RBS and HBOS.

A Scottish Parliament inquiry will investigate how badly Scotland's global reputation in the banking and financial sectors has been damaged by the actions of its big banks, RBS and HBOS.

The investigation, ordered by Holyrood's economy, energy and tourism committee, is intended to find ways to promote Scotland as a world player in the financial services sector and find out what competitor countries are doing.

The decision follows calls for an inquiry by the Sunday Herald into what happened to the financial giants and what it means for jobs and the economy.

The MSPs also want answers that will ensure the financial sector continues to retain a global perspective and does not retreat into a "purely localised lending regime".

Its remit is to assess the "longer-term consequences on the Scottish economy of the impact of the global financial crisis on Scottish financial institutions, and to identify actions necessary to ensure Scotland is well placed to meet the challenges of the economic upturn with Scotland recognised as a leading financial services centre".

The push for an inquiry follows a meeting at which the committee decided more information was needed on employment in the sector, the impact on inward investment, the availability and cost of credit, plans for restructuring banks and building societies and the effect of the crisis on businesses, and in particular small and medium-sized enterprises.

After the loss of 300 Scottish posts in Lloyds Banking Group following its takeover of HBOS, the committee also wants to know the extent to which banking bosses will retain headquarters' functions in Scotland.