ScoTTyB

It's the only way they will learn.

Bailed-out Royal Bank of Scotland bankers set for millions in bonuses - Times Online

Geezer

Whilst not what everyone wants to see this happen, if you read the article then they are tied into some of it, and they do not want to lose key staff.

What's the point of letting the bank self destruct if your money is shoring it up?

I would imagine we will do the same.

The 'only way they will learn' is if the government legislates on what they can offer as products and also if the greedy public can learn to stop thinking they are entitled to endless lines of credit and actually save up to buy stuff

I shan't hold my breath though, for either........

Geezer

NXG

Wrong. Buy as many shares in them that you can get your hands on. When the econnomy has recovered and it's back in the private sector you'll be minted

The Zohan

They may be key people but are they decent, honest and the sort of people you want in charge? anyone decent and with any self respect would refuse to accept the bonus considering the mess the bank is in.

In addition the gov't should demand for the (our) money back it has invested if this is how the bank think it is best use of the money - another poor decision, one of many by all accounts.

ScoTTyB

Personally I'd rather it collapse to show the public will not stand for this. Also if these people are so clever and worth so much money how come the bank would have failed were it not for intervention. They deserve 0 bonus imho, it's a reward for performance.

Do not forget they still earn a shed load of money.

jasey

More likely the folk who inherit your estate will be minted at the rate we're "recovering".

Assumes you are in your early twenties

Geezer

The people who will be getting these bonuses performed well in the parameters defined for them. They will perform well under the new structure, legislation, whatever, that is why they need to keep them.

Should they refuse the bonuses? Possibly, but I bet most people would not, despite it being easy to take the moral high ground on an internet forum......

So you would rather see £20billion of taxpayers money lost rather than a few millions spent on some people who probably worked very hard and this mess was not their doing?

As Hirohito said when given the choice of the destruction of Japan and it's culture, or the shame of surrender, "we have to endure the unendurable."

This is unprecedented, the banks cannot be allowed to fail, and that means some unpleasant realities to be faced.

99% of the staff of these banks have worked their socks off, they do not make the legislation, they do not make the products, they just work. I would expect anyone who puts in the effort to be rewarded, what's wrong with that?

Of course, the board members should not (and indeed will not) get bonuses.

Geezer

The Zohan

Hmm, Well Neither Jenny or her collegues got bonus this year. It was deemed best not to given the current situation and downturn in business, even though they had met targets. She works for a large company subcontraced into one of the big financial institutions.

Whilst she is a little peeved she can see the bigger picture. shame other cannot

it does irk her that others working for companies that have failed and fecked up bigtime then get given our money and then see fit to pay bonus, it may well be that they are not using the our tax money directly for bonus, even so any bonus would be better spent paying back monies borrowed!

Geezer

I utterly agree that is doesn't seem fair, but when people advocate letting the banks go under it's just silly.

I feel sorry for people who won't get bonuses because their companies are not in a position to pay out, but I don't think that means that others should not (no matter what business they are in).

Our bonus (and it is not certain we will get one) is not based upon our profit, so it's not always as clear cut as people think either.

On the flip side, why did people think they deserved endless lines of credit instead of saving up for stuff they usually couldn't afford? The principle is the same really, getting something when you don't really deserve it.......

I think the irony of it is lost on most people, as usual they want someone else to blame. This recession is a collective failure, it's not only the banks that need to take a good hard look at themselves.

Geezer

Devildog

Nicely put mate

Its incredibly idealistic to think that the best outcome will be to let RBS fail. (Or Barclays, or any other for that matter)

Its not just the Billions of taxpayers money that will be lost, it will be the cost of deposit guarantees, and the likely significant business failures and associated job losses as a result.

If a few inches of snow in England can apparently cause £2bn of losses to the economy, just think what the failure of one of the UK's major Banks will do.

We need key people in the banks (the do-ers and fixers) to keep them on track, and make sure that in the long run the capital investment by UK plc is repaid.

Its to late to do anything other than support them.

Idealistically, those that can't survive on their own should be allowed to fail. And not because of a few (in relative terms) greedy bankers who creamed millions off the top when the times were good. Simply because the economy should be allower to find its own balance in times like these. Ride out the storm, and rebuild at the other end.

But its too late, the investment has been made.

To the OP, if you want to apportion blame, make sure that Blair, Brown and Darling get some too. Instead of creating reserves when times were good, they pished away billions. Billions that would have been a pretty good rainy day fund to help in the current climate.

Blame them for not overseeing appropriate legislation to curb excessive and inapropriate borrowing and lending. Christ, its not as if no one knew this might happen.

And blame ALL the board members of all banks, not just the ones in the headlines.

I see Brown now wants to be judged on the year ahead. No wonder, he's a monumental fail on the year(s) before....

Devildog

Oh, and perhaps people should read the whole article, before posting threads

Stephen Hester, the new chief executive of RBS, is understood to be acutely aware of the sensitivity of any payouts and is considering paying most or all of the bonuses in RBS shares rather than cash. A plan to set a cap on payments is also being considered.

Some bonuses among the 20,000 bankers in GBM are regarded as unavoidable either because of guarantees given in the past or to retain individuals who have generated significant profits in their areas. Without big bonuses, they could defect. “RBS — and taxpayers — have no interest in the strongly performing parts of its investment banking business being shredded,” said one source.

This is also very interesting

Money Central - Times Online - WBLG: The 10 people most responsible for the recession

JPF

iTrader: (1)

lol I like the "apparently" when it comes to brown and its interesting how Browns position is qualified by the Conservatives, Tory spin doctors are doing a better job than there party at the moment.

One of the things I didn't get was why Brown didn't sort out the bank regulations more, then you findout why.
A lot of the banks are foreign owned so not covered by our regulators anyway, so Browns idea of global regulation of a global industry would seem like a sensible one?.

Also thinking about it do we really expect our governments to know everything about the running of privately run banks? what are they supposed to do? if the banks from the outside appear to be running ok what's government any government supposed to think? are we wanting our governments to spy on private companies?
Also I do seem to remember our wonderful opposition grumbling at some point about there being too much regulation in the UK?(just some thoughts)

I also think people forget its us too(at least some of us) that helped get our country in debt buying houses etc that we couldn't afford, maybe rather than blaming the government financially we should blame them for an education system that leaves a vast population of this country without the simplest understanding of maths.
Now I aint the brightest of sparks when it comes to sums but even I can see that if your money coming in doesn't cover the money going out you should STOP SPENDING! its the same as using money to buy things, if you cant afford the credit payments DON'T GET THE CREDIT!

Going back to the OP, closing banks because they are apparently paying big bonuses?, well sorry if you close the biggest banks in the country you asking for trouble, its like ripping the foundations of your house out. We have a shortage of credit in this country, ideally we need more banks not less.

I wish people would read more than headlines in this country as someone has mentioned the bonuses are being dealt with by government and the banks, if people are needed for the success of the bank they need to pay the money simple as that.
Like the footballer pay scam, the players just go to the team that pays the money they want, the only way to change that is to cap somehow what the teams are allowed to pay. Banking is global so needs all governments to agree to cap there banks wages for there top players.

All in my humble and in some cases unqualified opinion of course.

Geezer

Any company operating in the UK is bound by UK regulations, no matter who owns them. It's the same for a UK company operating in a foreign country.

Geezer

vindaloo

...unless it is re-financed several times over or you are forced to realise any losses or the gov't nationalises it and stuffs 2 fingers up to the shareholders.

lozgti

I'm still trying to work it all out.

They lent all their money out and can't get it back.We are all complaining it was really bad of them to lend it to us.

The end?

fivetide

iTrader: (1)

Doesn't seem to bother Obama. He's announced salary caps and a bonus freeze at institutions bailed out by US government funds. It is a condition of getting the cash....

5t.

Geezer

I think you'll find it is at executive level only.

Geezer

fivetide

iTrader: (1)

And no issue with that at all. Its a bit like the Northern Rock 10% for all staff. That was a good move. It isn't the fault of the counter staff and they'll have put up with a lot. They deserve it for sticking it out.

However these 'auto bonuses' have got to be a thing of the past.

5t.

jonc

"auto bonues" will always be used to attract and retain the top "money makers" and guaranteed bonuses would be written into their T&C of employment. No financial institutions will change that if they want to get the best people.

If you were to sign a new employment contract that stipulated a guaranteed bonus, would you turn in down? I doubt it.

fivetide

iTrader: (1)

Of course not so ban it. If no one can offer it then it makes no difference does it?

The entire point is these 'top money makers' have lost billions so hardly that good are they?

As usual the Daily Mash is on the button...

RBS EXECS TO REV THEIR FERRARIS VERY LOUDLY OUTSIDE YOUR HOUSE - The Daily Mash

jonc

Ok, guarenteed bonuses are banned. What alternative can you come up with to entice/keep the best people in your business on top of what is already offered in standard package ie pension, private health, share options, company car etc.

Bare in mind that not all "top money makers" have lost money, there are also plenty of those in the business who have made billions too. To ban it could mean that all the best skilled and experienced people will seek employment in companies overseas that offer these bonuses. UK would no longer be the leaders in the global economy and that would have a far greater impact.

fivetide

iTrader: (1)

Simple - Bonus awarded for responsible behaviour only. We lose money -they don't get extra money. Rewards for due diligence and proper accounting/auditing rather than being rewarded for recklessness.

Simples!

EDIT - should add we are talking about publicly funded banks here. The main destination would be the US - where it is being banned - so that covers the brain drain.

5t.

jonc

Believe it or not, but that is already the standard practice for bonuses, not just for front office traders, but also for back office staff operations, settlements, risk and compliance departments (to name a few involved in trades) . Traders on the whole do not have the time to carry due dilegence, "accounting/autditing" etc. The pace of the markets in general day to day trading doesn't allow this.

US is not the main destination for a brain drain. The banking industry is global which is why there are US, European and Asian banks in every other country each governed by the "local" regulation, legislation, practices etc.

Therefore if take away the incentive to stay in a publicly funded bank, the top people will simply go else where since there is no other obligation for them to stay, which would be bad for the bank, the Government and for the tax payer.

SunnySideUp

RBS: About Us – Our Board

Spot the Tory MP's

fivetide

iTrader: (1)

Unfortunately this isn't the case. The free and easy credit has been the issue. Simply taking Fred Goodwin as an example here is a man rewarded time and time again for bad business. How does that fit with what you are saying?

I would also disagree regarding the US. I accept the Swiss, Germans etc have big financial clout but someone with a family is more likely to go to a country where they speak the same language if only for their family. The US is still a powerhouse of the world economy and for many the palce where it is at.

You haven't just recived a massive bonus for lending out tons of cash you don't have to people you know will struggle to pay it back have you?

5t.

jonc

No, I haven't received my bonus yet, and not sure I even will this year. I work in a financial institution and have been working in the city for over 10 years. This is how the financial industry operates regarding remuneration of its employees and this is how it will always be in the city, just as long as those at the top donate to those "looking after the country. Not even this credit crunch can stop this bonus culture.

Many execs speak more than just English. We have many execs and traders from the Continent, likewise we have English speaking staff working quite happily in our foreign offices dealing with English and foreign speaking clients. Yes, the US is a major financial hub, but this does not mean the US have the best paid jobs with the best paid benefits and best tax breaks.

Regarding Fred Goodwin, yes he's made some huge mistakes and stupid deals, but lets not forget that since he was brought in he built up RBS to be one of the five biggest banks in the world. His aggressive expansion policy and his decision to buy ABN just before the crunch was his and RBS's downfall.

(no, I don't work for RBS or do dodgy loans.)