Trout

iTrader: (1)

...Dodd-Frank which will impact most Global banks (e.g. Barclays, RBS, UBS, HSBC, etc) will require that Executive Compensation (Bonus to me and you) will be subject to clawback if performance targets are not achieved. And it will be retrospective as many bonuses are spread over three years.

So, bankers may be subject to paying some or all of their bonuses back!!! And a number of banks will have executives who fall into this category!!!

Of course this will create a new wealthy elite, employment lawyers from the Magic Circle will be having a field day!

EddScott

/shrugs


I think folk would be more forgiving if the banking sector wasn't so arrogant in the way it goes about its business and didn't behave in quite such a poor way to the common customer.

Most banks frankly are complete w*nkers when it comes to the common folk. If they were a little more willing to give something back rather than take take take, the feeling amongst the masses might be different.

If we now suppose to feel sympathy for the banking sector, where is the sympathy those that actually use the banks?

f1_fan

iTrader: (9)

Yawn! Same ****, different day!

tony de wonderful

The banks could have avoided this by not taking tax payer money though Trout.

cster

A very dangerous precedent to send to the majority of these Isles inhabitants!

Trout

iTrader: (1)

Banks could have avoided what specifically?

tony de wonderful

Nobody forced them to accept tax payer money.

Trout

iTrader: (1)

I am still not quite making sense of this.

What could the banks have avoided?

GlesgaKiss

What sort of system is this where people who miss targets are given bonuses, anyway? Any sort of bonus should be for good performance or pleasing shareholders or management.

The banking sector is a f*cking joke the way it's operating; although I agree, it's crowd pleasing and not getting to the route of the issue.

David Lock

Quite. And Diamond has IIRC just received a £3m bonus and must be struggling on £10m a year basic (or something like that). And he runs an organisation that receives 250,000 complaints a year It's mind boggling.

dl

fivetide

iTrader: (1)

Way to present a one sided arguement.

First thing - Barclays didn't take any government money.

Second, the bank made £6bn last year so his pay in those terms isn't a lot.

Third, anything that size will attract a number of complaints. The percentage of complaints to customers would be better. However the legislation opened up here is about profit performance, therefore wouldn't apply.

And as for not being forced to take government cash. Didn't the government force Lloyds to swallow HBOS?

5t.

Hanley

It's not as easy as saying Barclays received 250,000 complaints.
You'd need to view what percentage of their cusotmer based complained to paint a true picture.

Also, how many of these complaints are from people trying to claw back PPI and see it as an easy way to grab a bit of cash?

David Lock

First thing. I am aware of that but they worked pretty safe in the knowledge that government money would be there if they ran into trouble

Second thing. Clearly business size is relevant but I still think basic should be more than enough.

Third. Of course I don't have a knowledge of the complaint details but the overall scale of dissatisfaction is huge. It really does seem to be an uncaring group which is fine in pure "lets make money" terms but not much else. In a very broad comparison the NHS received 114,000 complaints in 2009/10. I wonder how many Tesco got which is a more relevant comparison.

dl

tony de wonderful

You are being willfully obtuse. The banks were never forced to accept the tax payers money that came their way via the various bail-outs. The banks are not forced to have the BofE/state act as the guaranteer on deposits too.

The banks asked for the state to help them to be blunt.

If they could have chosen not to, and would now have legitimate moral case for telling the government to stay out of their bonus culture.

Dingdongler

I don't get this Trout. If bonuses can be clawed back if targets aren't met that implies the bonuses are given out prior to targets being met. Is this what happens in the banking sector?

My wife who works in media and publishing only gets a bonus if and when she hits a target and therefore paid retrospectively.

jonc

Hypothetically, if we wind back to 2008-9 and RBS, LLoyds TSB , HBOS, and Northern Rock went bust. Go across to America, AIG, BoA, Citibank, JP Morgan, Morgan Stanley, Goldman Sachs, etc received no bailout, what would be the state of the global economy?

With huge unemployment as a result of the businesses going under due to lake of capital because banks going bankrupt, people's debt spiralling out of control and losing their homes, up risings in Middle East, the failing/failed Euro, how would the high street look today? What would the Government have done with the ensuing depression that would most likely have taken hold? What would have happened to everyone's pensions, life savings, investments, businesses etc. Whilst long term the economy may be better, but I would guess that the short term pain would have been too great for everyone to bear.

If given the option to vote whether to bail out or not I think I would have voted for the bailout.

fivetide

iTrader: (1)

didn't need it though. Knew they wouldn't. Are you saying that because they ran a prudent busines they should be punished?

You do not get people running £6bn (that's profit not turnover remember) businesses for £30k a year.

As has been shown, you need the best people to run it properly. To do that you need to pay them the right money. Mr Diamond has generated a huge sum of income for the UK. His bank has lent money to a vast number of businesses (That's where they really make the money) which has allowed the wider economy to keep going.

Pay him the cash or potentially rescue his bank. One has cost the taxpayer nothing, one would be expensive.

To say otherwise just smacks of jealousy to be honest. Good luck to the chap.

right....

so you can say all that having admitted you have no idea what you are basing it on?


5t.

cster

The NHS paid out £865,000,000 in compensation last year. I think it might be better if we leave them out of this argument.

Trout

iTrader: (1)

Take the blinkers off just for a moment - I know your views posted above.

What I don't understand is how that relates to the original post

Trout

iTrader: (1)

The point of the legislation is to bring a degree of longer term thinking (just like Hester's bonus that did not mature for three years )

Banker A gets a £100k bonus for 2011 for meeting certain targets.

But completely misses these targets in 2012, then there may be some clawback of his original bonus.

Complex and crowd pleasing.

Trout

iTrader: (1)

Do you just make this up as you type

Bob Diamond's base salary in 2011 was £1.35m

His bonus is around £3m, which if he does not take for three years will rise to around £9m, based on a constant share price.

Lee247

Trout, you are wasting your time and energy. No one likes Bankers or Banks at the mo'
They appear to serve no one but themselves. So no matter how you try, I doubt you will change anyones mind for some considerable time

Dingdongler

Yes, does sound very complex. I have never worked in a bonus based job but my wife does. I can only base my knowledge on my wife's set up where having bonus clawed back because she didn't manage to do in 2012 what she did in 2011 would be unacceptable.
It would also be very difficult to administer and monitor imho

Trout

iTrader: (1)

It depends what my outcome is

I find these debates quite entertaining!

FlightMan

Are you a mass debater? If so shouldn't you be banking?

Suresh

Bankers have been receiving bonuses on expected outcomes with respect to future cash flows. If the eventual cash flows don't match expectations then a clawback is only reasonable. Or better still only pay bonuses out of cash received. Problembis nobody would lend or transact for tenors more than a year or two though. Fancy a mortgage you have to repay in two years? Thought not!

PS I work for a bank that hasn't had any state support either.

PaulC72

Yes they did, the government 'requested' LTSB take over HBOS and get them out of the **** in return for a healthy handout from them to help the situation.

People soon forget the problems that would have come about hsould the banking system been allowed to collapse like it was going to without the help.
LBG as they are now have turned what was a very shoddy operation in Halifac and BOS into a reasonable company.

As far as complaints go I think LBG have allot less than banks like Santander who are quite shocking.

Luan Pra bang

Some traders/bankers have their bonus held back a year so their bonus can reflect 2 years performance not just one. The flaw with this is that to really be accurate and award what is fair you would need to judge over a full cycle from boom to bust and then see their net gains. This means that IMO bonus's should be held back for minimum ten years as any idiot can match a growing market, its those that consistently beat the market through a long period that deserve the big money. The banking industry just rewards its people on far too short term thinking and 3 years is still far too short.

jonc

You can't hold it for 10 years or more, rarely, if at all, an individual in this sector stays in the same role that long for a start. What happens when people move a new trading desk or operation or new company? Trade desks comes and goes depending on the strategy of the organisation to seize opportunities that come and go in the market.

jef

iTrader: (13)

unfortunatley in this world the people that do others the most help, are rewarded with minimal reward, entertainers are wildy over paid, but again probably generate the most income

its a reflection on society, and where peoples values lie, and also where they choose to spend some time educatig themasleves outwith paper publications.

huge income genration = rewards. good honest work helping others/services = not a lot

so so so many over paid sectors, along wiht so so many underpaid sectors also, and some in the middle, getting what they deserve, along with those doing zero and getting in a % return, massive overpayments