Bank bail-outs and bonuses: Do the two mix?

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Gina Dyer
Deputy Editor
Sift Media
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This week the government doubled its investment in bailing out the already part nationalised RBS and Lloyds Banking Group, injecting a further £37bn into the ailing banks. With the taxpayer footing the bill for one of the world’s biggest government rescues, the issue of bonuses has reared its ugly head once more.

As part of the new deal, the government sought pledges from the banks that staff earning £39,000 p.a. or more would not receive cash bonuses, and executive directors would have bonuses deferred for three years. Despite the proposed ‘crackdown’, pay experts and politicians remained unconvinced. “This is all hot air. This has nothing to do with risk management and everything to do with populism”, Liberal Democrat shadow chancellor Vi...

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By 1582631
06th Nov 2009 13:38

Bank bonuses

Every article that mentions bank bonuses anywhere in the western world makes reference to retention of talent as the main purpose of keeping bonuses.  Just where exactly is this 'talent' going to go? Are we not hearing of thousands of banks, stock-brokers and finance graduates on the dole? I think it's worth the risk! Let them go!

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By Anonymous
06th Nov 2009 14:42

I agree!
I agree - where is all this "talent" going to go if they don't get their bonuses? The traders could probably sell cars or work at estate agents but the rest of them do not have any skills that could work in other industries. This is blatantly the old boys club protecting themselves from being exposed as just ordinary people who only deserve ordinary compensation. The banking system will not collapse if we stop paying excessive bonuses, we can manage to run a much more important industry, the NHS, without paying extortionate sums of cash. It's time we removed the shroud of secrecy that hangs around the banking industry.

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06th Nov 2009 15:02

But where has all the profit come from!

Paying bonuses is all very well, or not, as the case may be, but I am not clear on what 'profits' these bonuses are being paid. If these profits are so enormous that substantial bonuses can be paid, why have these profits not been ploughed back into the business as a 'bale out'

And where has all this 'profit' come from? Have the banks been selling things, have they been trading in things (or imaginary things) or have they been printing it? In my feeble-minded way I always assumed that if someone has made a profit, then someone has made a loss, or at least paid out for something i.e. an exchange of money has taken place. So, who has made the loss or paid the money?

I suspect, like in so many things, it is us lowly taxpayer who has footed the bill!!

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14th Dec 2009 09:28

bank bail out

Year 20029 can be considered the worst year among businesses for there were many bank failure reported consequently the government did not  fail to extend bailout to the trouble financial institution and it awakened the mind of the tycoons to adapt a conservative investment. However, to keep from losing a lot of money, you need to know the basics of investing before trying to invest online.Traditionally, buying stocks through a broker meant pinching and saving your pennies for many years before being able to invest in the stock market. If you didn't have enough money to start already if you wanted to start quick, you needed to borrow money or buy stocks on credit. This is also called "buying on the margin.” With the ease and convenience of the World Wide Web, however, the playing field has been leveled, allowing most anyone to enter the stock market with less money than before.

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