The world's leading investment banks yesterday agreed to pay more than $1.4 billion (€1.36 billion) and make sweeping reforms to settle accusations that their US research analysts misled investors during the 1990s stock market bubble.

The deal, secured by US regulators, represents an unprecedented exercise in public shaming, and raises the question of whether Wall Street will ever reclaim the public regard that once gave its analysts rock-star status.

Mr Jack Grubman, former telecommunications analyst at Citigroup's Salomon Smith Barney, was singled out by regulators. He was fined $15 million for misleading investors and banned from working in the securities industry.

The settlement with the banks stops short of the radical restructuring that many on Wall Street had feared, meaning the big financial conglomerates assembled during the boom will survive in their current form.

The agreement between 10 investment banks and a coalition of state and national regulators opts for a system of checks and balances designed to keep their research as free as possible from the taint of investment banking concerns. US Bancorp Piper Jaffray and Thomas Weisel were not part of the agreement.