City Bonuses Shrink – But Basic Salary Rises More Than Make Up For It
THE GUARDIAN: Bonus payouts shrank by 8% over last 12 months at the same time as permanent 7% rise in basic salaries in Square Mile

Workers in the City of London who have seen contentious bonus payouts shrink by 8% over the last 12 months have more than made up for their loss through a permanent 7% rise in basic salaries, according to a study published today.

Bonuses paid to City workers fell from £7.3bn to £6.7bn for the year to April, the Centre for Economics and Business Research (CEBR) says, but these purported performance-linked payouts remain a step above levels recorded in 2009, when the worst banking crisis since the 1930s saw the City's bonus pool dip to £5.3bn.

However, more than offsetting the impact of shrinking City bonuses, basic salaries in the Square Mile – which still make up the lion's share of pay deals for most City workers – jumped 7%, according to CEBR's analysis of official data from the Office for National Statistics.

Lord Oakeshott, the Liberal Democrat peer who resigned as a party spokesman in protest at what he saw as the coalition's failure to curb banking industry excesses, said: "Real incomes are now being seriously squeezed in the rest of Britain but City pay just sails merrily on." » | Simon Bowers | Tuesday, April 26, 2011

Senior Lib Dem Sacked for Criticising Controversial Deal for Bankers
THE DAILY TELEGRAPH: Coalition tensions over bankers’ bonuses have been laid bare with the sacking of a senior Liberal Democrat who criticised a controversial deal announced by George Osborne.

Lord Oakeshott, a close ally of Vince Cable, the Business Secretary, was last night removed from his post as the Lib Dem spokesman on Treasury issues.

His departure from the post came after he condemned the Coalition’s agreement with the banking industry as inadequate and accused Mr Osborne’s team of “arrogance and incompetence”.

Under the deal with the industry, the heads of the taxpayer-backed high-street banks will receive multi-million pound pay and bonus packages for last year.

The Chancellor said it was time to move from “retribution to recovery” and agreed to water down laws which would have identified multi-million pound bank traders.

However, under the terms of the “Project Merlin” deal, the country’s main high-street banks have agreed to increase lending and provide funding for community projects – in return for the Government not vetoing their bonus payments. >>> James Kirkup, and Robert Winnett | Wednesday, February 09, 2011

THE DAILY TELEGRAPH: RBS's Stephen Hester and Lloyds' Eric Daniels accept multi-million pound bonuses: The chief executives of state-owned Royal Bank of Scotland and Lloyds Banking Group have accepted multi-million pound bonuses on the same day George Osborne unveiled details of a deal with UK banks that should cut pay-outs. >>> Harry Wilson and Andrew Trotman | Wednesday, February 09, 2011

HSBC Chief Executive Stuart Gulliver In Line for £9m Bonus
THE SUNDAY TELEGRAPH: Stuart Gulliver, the new chief executive of HSBC, is expected to accept a bonus of as much as £9m later this month in reward for his stewardship of the bank's investment arm.

Mr Gulliver, who took over from Mike Geoghegan at the turn of the year, is set to be awarded the windfall as part of an overall compensation package which could take the total amount he receives for 2010 to in excess of £10m.

Although the bank's remuneration committee, chaired by HSBC's deputy chairman, John Thornton, has not yet finalised any executive bonuses, City sources with knowledge of the situation believe that a bonus of £9m is highly possible.

If so, it would mirror the amount Mr Gulliver received for 2009, and would be in line with the amount his counterpart at Barclays, Bob Diamond, is set to be paid.

Stephen Hester, the chief executive of Royal Bank of Scotland, and Eric Daniels, the chief executive of Lloyds Banking Group, are likely to be in line for awards of £2.5m and £2m respectively. >>> James Quinn and Kamal Ahmed | Sunday, February 06, 2011

David Cameron Won’t Stop the Bonuses >>>

Millionaire Bankers' Message to Britain: We're All Right, Jack
THE INDEPENDENT ON SUNDAY: Britain’s bankers are celebrating bumper bonuses. Whatever happened to the Government’s pledge to tackle them?

After umpteen calls for restraint by ministers, weighing the public relations impact, and consulting colleagues and advisers, Barclays chief executive Bob Diamond has made his most difficult decision. The multi-millionaire is set to accept a £9m bonus, one of the largest in the world, and will be followed by the bosses of the other major banks. This shows that they are all in something together, even if it's not what the rest of us are in.

Mr Diamond canvassed close City friends before deciding to take the bumper bonus which he fears will reignite the row over bankers pay. Sources close to him said: "Bob's been in a real dilemma as he can't stand this country's culture of banker-bashing and finds our attitude to bonuses extraordinary. But he is also aware of public opinion, so sounded out people about whether he should turn down his bonus again for the third year, take less or give some to charity."

Despite rising public anger about the scale of City payouts, David Cameron insisted last night that he was not interested in "headlines satisfying people today and tomorrow that I've given the banks a good kick in the pants. Can we do more on bonuses, particularly on those banks we own? Yes we can, and yes we will," he told The Sunday Telegraph. "But look, we've just been talking about growth. I don't believe actually in the long run, you can deliver the enterprise-growth agenda while having a running war with the British banking industry at the same time."

Some of those whom Mr Diamond – or his advisers – have consulted counselled him to show restraint. But the American decided that when he is offered the pay package – somewhere between £7m and £10m – he is minded to take it. >>> Margareta Pagano, Business Editor | Sunday, February 06, 2011

Why don’t they jail these SOBs? Then they would show some restraint! – © Mark

London's Neediest Curse City Bonuses

Terry Murden: Bank Bonuses Are Back as Politicians Roll Over
THE SCOTSMAN: NO-ONE should be surprised that the banks are expected to defy public opinion and once again pay multi-million pound bonuses.

Difficulties in controlling the bonus culture have been made plain by the frustrations felt by politicians across the spectrum and were highlighted here as far back as August 2009 after the then shadow chancellor George Osborne demanded that bonuses should be banned altogether in banks that had been bailed out by the taxpayer.

Well, he's moved a long way from that particular argument and now doesn't even see eye-to-eye with the bite-your-legs business secretary Vince Cable, who has found himself muzzled over the issue.

The bankers believe the Lib Dems who have been making most of the noise on this issue are now a bit of a spent force in the debate and that the slightly more banker-friendly tone emanating from Osborne and Prime Minister David Cameron will leave them free to award themselves the sums they see as their right.

The banks argue that they contributed towards the £53.4 billion paid in taxes last year by the financial services industry, equal to 11.2 per cent of Britain's total tax receipts. No wonder the Treasury should consider it inappropriate to bite the hand that feeds it.

Before Christmas there were more threats of a new bonus tax, an idea revisited by Deputy Prime Minister Nick Clegg, and warnings from Cable that the banks would be punished if they didn't change their ways. But opinion in the City is that there is not much substance behind them.

The bankers are now said to feel so confident of getting away with paying large bonuses that they see no further need for Project Merlin, the initiative led by Barclays former chief executive John Varley to repair relations with the government. Expect the next round of bonuses to be trimmed, but only marginally, and as an acknowledgement of, rather than a concession to, public outrage. >>> Terry Murden | Sunday, January 09, 2011

THE SUNDAY TIMES: Lib Dems tear into Tories on bonuses: Ministers are furious at George Osborne’s apparent cave-in over unacceptable bank bonuses in a time of austerity >>> Marie Woolf, Whitehall Editor | Sunday, January 09, 2011 (£)

THE OBSERVER: Britain's best-paid bank boss set for showdown with MPs over huge bonus: Barclays chief Bob Diamond is under intense pressure to lead by example and give up payout >>> The Observer | Sunday, January 09, 2011

Greed! Sheer Greed!
TIMES ONLINE: The City watchdog was accused of giving banks a green light to continue paying multimillion-pound bonuses yesterday when it backed away from introducing tough rules to curb excess pay.

The Financial Services Authority’s proposals on City pay embarrassed Gordon Brown, who had promised to sweep aside the bonus culture in the financial sector. Opposition politicians branded the FSA’s new proposals a capitulation. The Treasury also indicated that they did not go far enough.

Some of the most onerous provisions in the FSA’s original proposals from March have been softened. Under the new guidelines the banks must link risk and reward. But they will have more freedom to structure bonus packages than was previously suggested and many bank executives and some smaller City firms are excluded from the plan altogether.

The row came as unemployment rose to a 14-year high and the Bank of England admitted that the recession was deeper than previously thought and that recovery would be slow, partly because banks were still not lending enough money.

It will be exacerbated by the disclosure that Royal Bank of Scotland, in which taxpayers have a 70 per cent interest, has hired two bankers on multimillion-pound packages. One of them, Antonio Polverino, who has been headhunted from Merrill Lynch, will earn £7 million in his first year. Watchdog 'gives green light' for huge City bonuses >>> Philip Webster, Political Editor, and Katherine Griffiths, Banking Editor | Thursday, August 13, 2009

Banks Defend Bonus Culture as Profits Jump
THE GUARDIAN: Barclays and HSBC made a passionate defence of the City's bonus culture yamid [sic] a growing public backlash about the return to a big pay bonanza barely a year after the government bailed out the financial system.

As criticism of bonuses crossed the traditional political divide, the banks compared their high-flyers to footballers and Hollywood stars to try to explain the need for the hundreds of thousands of pounds individuals are expected to receive this year. Neither bank gave figures about potential bonuses for investment banking staff, but a jump in profits in both operations led to speculation that huge pay deals will be awarded.

Profits at Barclays Capital, the investment banking arm of the high street bank, doubled to £1bn while at HSBC's investment bank the profits rose 125% to $6.3bn. Each bank reported overall profits of nearly £3bn despite a combined £13bn of bad debts caused by rising unemployment, making it more difficult for households and companies to pay back loans. Bank shares jumped sharply, pushing the FTSE 100 to its highest level this year.

John Varley, chief executive of Barclays, turned to footballers to explain bankers' pay while Stuart Gulliver, who runs the investment bank at HSBC, used Hollywood stars. Varley said: "The football analogy certainly goes some way I think [to explain bonuses] ... There is simply no higher priority that to ensure we field the very best people. That in a sense is exactly the same as a football manager if they are going to win. Our obligation is to ensure we pay appropriately."

Gulliver likened the situation to a Hollywood studio that not only paid stars for pulling in profits, but also many of the extras. "If a foreign exchange trader makes a deal then they know two days later how much they made. If it's a £5m profit, that is something we can count, we can see it, its real. And they are part of a successful team," he said. >>> Jill Treanor and Phillip Inman | Monday, August 03, 2009

City Bankers Are Already Lining Up for Bonuses Again
After helping the world get into its financial mess, bankers at HSBC are now lining up for renewed bonuses. Photo courtesy of MailOnline
MAIL Online: HSBC bankers are in line for bumper bonus payouts after an 'encouraging' jump in profits.

While the company's performance added impetus to a day of good economic news, the re-emergence of the City's discredited bonus system will be an embarrassment for Gordon Brown, who has promised to outlaw reckless behaviour in the Square Mile.

Taxpayer-controlled Royal Bank of Scotland has already started offering 'guaranteed' bonuses to traders in defiance of promises it made to rein in no-strings-attached rewards.

And Barclays is gearing up for massive payouts after profits rose 15 per cent in the first three months of 2009.

The culture of extravagant bonuses encouraged bankers to take ever bigger risks, laying the ground for the gravest financial crisis since the Great Depression of the 1930s. >>> By Simon Duke | Tuesday, May 12, 2009

The Greedy Bastards at ‘Goldmine’ Sachs, Morgan Stanley, Merrill Lynch and Dresdner Kleinwort Just Can’t Steal Enough of Your Money!
BANKERS at four City firms have collected bonuses of more than £6.4billion this year, despite the worst financial crisis since 1929, it emerged yesterday.

While the rest of the country struggles under the ravages of the recession, London-based traders at Goldman Sachs, Morgan Stanley, Merrill Lynch and Dresdner Kleinwort have been notified of their bumper payouts.


They come despite the banks having reported a dramatic fall in profits and the Government bail-out of the banking sector.



Goldman Sachs has taken billions of taxpayer funds, as has Morgan Stanley.



And the huge payouts will hand further ammunition to those critics who blame the greed of bankers for the global economic crisis.



They believe such large bonuses have created a culture of short-termism and recklessness which fuelled the excesses in the run-up to the credit crunch and led to millions of jobs being lost. What Recession? £6.4bn Bonuses for City Bankers >>> By Mark Reynolds and Michael Pickard | Monday, December 22, 2008

The Dawning of a New Dark Age (Paperback & Hardback) – Free delivery >>>

Shoot the Bastards at Goldmine Sachs!
MAIL Online: Investment bank Goldman Sachs is to pay £4.3billion in bonuses to its City workers.

Despite the financial crisis and the spectre of soaring unemployment, staff at the bank will get an average of £142,600 each.

The international group, which is estimated to have 5,400 employees in London, is already nicknamed ' Goldmine Sacks' for the large extra payouts it awards to its star performers.

Yesterday the firm posted its first loss for almost a decade. And earlier this year it was forced to accept a £6.5billion lifeline from the U.S. government after falling prey to the economic crisis.

Now, an amount equivalent to two thirds of that aid will be paid to its workers as bonuses. Goldmine Sachs: As Jobless Toll Soars, Investment Bank's Bonuses for Staff Are Cut to a MERE £4.3bn >>> By Karl West and Nick McDermott | December 16, 2008

The Dawning of a New Dark Age (Paperback & Hardback) – Free delivery >>>

Is This the First Piece of Common Sense Coming from This Government?
Photo of Alistair Darling courtesy of The Telegraph
THE TELEGRAPH: The Chancellor today criticises the culture of rewarding failure in the City by giving bonuses to executives who appear to have done little to deserve them.

In an interview with The Daily Telegraph, Alistair Darling says that as the country heads into an economic downturn, company boards must be able to justify large bonuses. They should apply the "next-door neighbour test" of whether the payouts would be regarded as reasonable and responsible in a climate when millions of households are struggling with rising living costs, he says.

"People get fed up if they see others getting great big bonuses and they can't actually see what they did. It can be extremely frustrating," Mr Darling says.

"Boards need to ask themselves, 'Are we behaving reasonably?'… If you're leaning over the fence talking to your next-door neighbour, can you justify what you've done?"

City bankers made an estimated £7 billion in bonuses last year. The bumper bonus round was one of the largest ever for investment bankers, despite the global economic turmoil and significant falls in the value of shares on stock markets around the world. Alastair Darling Attacks Bonuses for City Failure >>> By Rachel Sylvester

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