bonus or not

[Paul Chapman]

It was interesting watching and listening to the House of Commons Select Committee today questioning the ex-chairmen and CEOs of HBOS and RBS. One of the things that transpired was that the Head of Risk at HBOS warned the board that the bank was over-exposed. He was promptly fired by the then CEO, Sir James Crosby. Sir James has since been appointed by Golden Balls as a financial adviser and to the position of Deputy Head of the Financial Services Authority.

You couldn't make it up :shock: :shock:

Cheers :wink:

Paul

 

[neilyweely]

I don't use this word if I can help it. But I HATE the banks. And the fatcats? Well, what comes around, goes around. Thats gonna hurt some!!

Neil

 

[Paul Chapman]

The House of Commons Select Committee will be interviewing the current bosses of the banks today. It will be interesting to hear what is asked and said about bonuses. Starts at 2.30pm http://www.parliamentlive.tv/Main/Video ... ingId=3422

Might be worth watching if you want to find out how your tax is being squandered..........

Cheers :wink:

Paul

 

[Ironballs]

I recognise the need for the stock markets to provide investment for companies but must admit that for years it has felt largely like people making money for nothing, hedge funds for example, what do they actually contribute or deliver to the world as a whole? Nothing. It's just gambling

I work for a very big company and whilst I may be frustrated from time to time that I don't often directly see the impact of what I'm working on, I do know that there is an impact and something of benefit is being delivered to the company and customers.

That rant aside, the problem with these bankers bonuses has been debated quite well already, the issue is that they are contractual and if an individual has worked in a section of the bank that has delivered a positive result then they will feel entitled to their bonus. Our bonus system (and I stress here that ours is not big and very much what the company likes to call an "opportunity") is based on overall company performance and then by directorate. If the company overall has performed badly then it's simple, no bonus pot. However, we have an instance where the area I was in did very well and we got a good bonus but another area did quite badly and their bonus was very poor - and their director got the flick.

The problem our unelected leader has is that for this year he cannot get round those contracts and can only appeal to the better nature of the bankers, however if those bankers are on a 50K basic say and a 100K bonus then they know that they cannot live without their bonus, all their living expenses will be geared around it. So they won't turn it down.

What he should have done is handed over the cash to the banks with some clear strings about contract revisions to be applied from this year forward. There is a tricky line to be trodden though, he wants the banks to be stable, but not so stable that they take no risks and stem the investment needed to keep the economy moving

On a side not, I think the general public would have taken much more heart from those banking heads being set up in some stocks in parliament square with a good supply of rotten fruit to hand than their fake apologies

 

[LarryS.]

Seems to me there's a common sense approach to this :

Did the individual meet their Bonusworthy objectives (which would have been agreed at the start of the year) ?

In my job we agree 'stretch' objectives i.e. above and beyond the day job, I worked damned hard to meet them, if I do then I should get that bonus

So for instance if my local bank manager had a target of bringing in £1m of new business and for that he would receive a £1,000 bonus. Well if he's done that I see no reason why he should be punished for the decision of a guy (the banks chairman for instance) who like most of us he would have only ever seen on tv and had no influence over - so he gets the £1,000.

If however the Banks Chairman didn't meet his targets (which I am presuming in this situation they haven't) then they get nothing.

There's too many sweeping statements used like 'Bank Workers should not get bonuses', life's always more complicated than that.

 

[andrewm]

Did the individual meet their Bonusworthy objectives (which would have been agreed at the start of the year)?

Agreed, What I was trying to determine in my first post was what those targets were such that the chairman of a bank is still eligible for a bonus when the whole sector is in the mess it is in.

The chairman of LloydsTSB was on the radio this morning saying that he was not going to take his bonus but was entitled to because LloydsTSB had performed better than their competitors. So, if the KPI is to not wreck the bank as much as everyone else then he probably would contractually entitled to it. What others seem to be discussing is whether he, or the others, should be morally entitled to their bonuses.

Andrew

 

[Paul Chapman]

What others seem to be discussing is whether he, or the others, should be morally entitled to their bonuses.

No, not all of us. Some of us are saying that many of the banks were technically insolvent so were in no position to pay bonuses. They were then given taxpayers money specifically to enable them to start lending to businesses and individuals. However, they now want to use that taxpayers money for a totally different purpose (ie paying bonuses). I don't think that they have either a legal or moral basis on which to do this.

Cheers :wink:

Paul

 

[Peter T]

It seems that former HBOS chief executive Sir James Crosby has resigned as deputy chairman of the Financial Services Authority (FSA).

This is the guy who was responsible for the reckless expansion which eventually brought down HBOS, and, interestingly, someone who Gordon Brown has great faith in!!

Poetic justice??

 

[StevieB]

Its all very well for someone senior to 'fall on their sword' and say I wont take 2 million in bonus (Lloyds chairman) bot dont forget this is on top of a million a year salary. He is not exactly leaving himself short. And this is a YEARLY bonus, not a once in a lifetime thing. For the last umpteen years he has taken a 2 million bonus. There must come a point where you have more money than you currently need / can spend.

What I find particularly galling about the whole debate however is MP's suggesting bonuses should be waived on ethical/moral grounds. This from a group of individuals who have some of the most generous expense, pension and 'extras' around. Just this week it turns out the Home Secretary has claimed over 100k as a 'second home allowance' - it may be within the rules legally but, ethically/morally? This allowance is for a pad in London if you have a main residence too far away to commute. By claiming her sisters London house is her main residence she has claimed the 100k on her family home in her constituency as her second home. As I say, maybe legal but certainly ethically doubtful. Not just her either, as the row over expenses and allowances recently testifies.

To me the politicians are trying to jump on the 'public outrage' at the banks bandwagon rather than doing this from a desire to curb executive pay. No point in biting the hand that feeds too hard - who else is going to pay for the after dinner speech's and non-executive directorships when they give up politics?!

Steve.

 

[andrewm]

What I find particularly galling about the whole debate however is MP's suggesting bonuses should be waived on ethical/moral grounds. This from a group of individuals who have some of the most generous expense, pension and 'extras' around. Just this week it turns out the Home Secretary has claimed over 100k as a 'second home allowance' - it may be within the rules legally but, ethically/morally? This allowance is for a pad in London if you have a main residence too far away to commute. By claiming her sisters London house is her main residence she has claimed the 100k on her family home in her constituency as her second home. As I say, maybe legal but certainly ethically doubtful. Not just her either, as the row over expenses and allowances recently testifies.

Which leaves me wondering. If it is her 'second home' will she be liable for Capital Gains Tax when she sells like the rest of us would or are the rules different for MPs?

Andrew

 

[cant-weld-wood]

i dont agree with wot is going on with this bank at all
bailed out with tax payers money then wants to pay these bonuses
with it as well.
its not right the first thing it should do is pay back the money it was given
then use the rest for bonus pay out.
if it don't leave any money then thats there fault. :lol: