B.O.E. gets tougher on bankers

[JensenA]

kiethton said:

7 years is totally OTT, a lot changes in that time, much of it not directly attributable to the poor sod on the ground at a specific bank who may end up with well over 5x annual base salary being demanded back.

If this ever happened (not that i hope it to) I would ensure I'm in no position to repay - transfer all assets into spouse name etc. and become a (spouse/trust fund sponsored) man of straw, get benefits too then!

5 x annual salary in bonuses!! My work is checked and QC'd every single day. My bonus is that I keep my job.
Also If they're doing nothing wrong then they have nothing to fear do they.

[98elise]

JensenA said:

kiethton said:

7 years is totally OTT, a lot changes in that time, much of it not directly attributable to the poor sod on the ground at a specific bank who may end up with well over 5x annual base salary being demanded back.

If this ever happened (not that i hope it to) I would ensure I'm in no position to repay - transfer all assets into spouse name etc. and become a (spouse/trust fund sponsored) man of straw, get benefits too then!

5 x annual salary in bonuses!! My work is checked and QC'd every single day. My bonus is that I keep my job.
Also If they're doing nothing wrong then they have nothing to fear do they.

People who get 5x their annual salary are in effect working on a commission basis. Say their target salary is 1m, then they get £200k basic, with upto £800k as a performance bonus. If they don't meet their targets then they don't get paid.

It is far better than paying 1m salary then hoping they they meet their targets.

I'm not in any way a banker, but I do believe its better to have a performance element to jobs like this. I've worked in an environment where bonuses were based on performance, and I much prefered it to flat salary.

[brickwall]

Zod said:

Actually, "mediocre" is too flattering a description of RBS's investment banking operation. It was mostly st. Most of the good Hoare Govett people were long gone by the crash.

I was an intern there in 2010. They had an OK-ish DCM operation, but the M&A side was an absolute st-show. There was no talent, and no strategy.

A few good people had been brought in to try and mend things after the crash, but a lot of them (and the few good ones they had before) were leaving in droves by 2011/12.

They also had one of the worst cultures I've seen in any company - I saw management turn a blind eye to misogynistic sexist bullying, as well as the 'standard' macho willy-waving, over-deference to hierarchy, horrendous face-time practices, and a 'fk-the-client' mentality.

They were, at the time, offering one of the most lucrative graduate starting packages in the City (£10k signing bonus, total package ~£65k) and yet, unsurprisingly, all of their really good interns turned down the offer.

[Derek Chevalier]

Digga said:

Zod said:

Quite. People seem to forget that Lehman was a pure investment bank, while RBS was a large universal bank, with a mediocre investment bank that was brought down by a terrible acquisition and poor lending. At the smaller end, neither Northern Rock, nor Bradfrod & Bingley had anything to do with investment banking. All this talk of keeping the "safe" retail banks insulated from the risky "casino" investemnt banks is total bks.

It certainly misses the point that certain of the 'casino' banks, such as J P Morgan, had taken a far more conservative view of CDOs.

But not on CDS

http://en.wikipedia.org/wiki/2012_JPMorgan_Chase_t...

[Digga]

Derek Chevalier said:

Digga said:

Zod said:

Quite. People seem to forget that Lehman was a pure investment bank, while RBS was a large universal bank, with a mediocre investment bank that was brought down by a terrible acquisition and poor lending. At the smaller end, neither Northern Rock, nor Bradfrod & Bingley had anything to do with investment banking. All this talk of keeping the "safe" retail banks insulated from the risky "casino" investemnt banks is total bks.

It certainly misses the point that certain of the 'casino' banks, such as J P Morgan, had taken a far more conservative view of CDOs.

But not on CDS

http://en.wikipedia.org/wiki/2012_JPMorgan_Chase_t...

Staggeringly daft - amazed it was able to happen - given their previous caution and obvious close call with the 2007 crash.

[otolith]

The same people who would be delighted if this kind of measure did drive the banking industry overseas would be the first to moan when the shortfall in tax revenues leads to cuts in benefits and services.

[anonymous-user]

otolith said:

The same people who would be delighted if this kind of measure did drive the banking industry overseas would be the first to moan when the shortfall in tax revenues leads to cuts in benefits and services.

Employs 1.1m people (3.8% of the workforce) and contributes £65bn in tax (11.7%), those dummies wishing the UK's financial services industry diasappears to Paris, Frankfurt, Singapore and New York need to explain where they are going to find the replacement tax take from.

[Digga]

fblm said:

otolith said:

The same people who would be delighted if this kind of measure did drive the banking industry overseas would be the first to moan when the shortfall in tax revenues leads to cuts in benefits and services.

Employs 1.1m people (3.8% of the workforce) and contributes £65bn in tax (11.7%), those dummies wishing the UK's financial services industry diasappears to Paris, Frankfurt, Singapore and New York need to explain where they are going to find the replacement tax take from.

No talking logic to the believers of teh magic cake. They only think about slicing it (redistributing) not creating it in the first place.

[Zod]

If bankers' bonuses are further restricted and reduced, how on Earth does Labour hope to pay for its promises?

Miliband has spent the bonus tax at least ten times so far.

[turbobloke]

Mark Benson said:

This move will punish the 'Evil Banker (tm)' and placate the unthinking masses while doing little to prevent a recurrence of the crisis.

Even so, if another crisis looms, the socialist money tree will come to our rescue.

[DeltonaS]

fblm said:

Employs 1.1m people (3.8% of the workforce) and contributes £65bn in tax (11.7%), those dummies wishing the UK's financial services industry diasappears to Paris, Frankfurt, Singapore and New York need to explain where they are going to find the replacement tax take from.

Exactly, all politics and the sole reason why London does all it's banking regulatory on it's own, apart from the rest of the EU. It's scared stless that they leave, which would cost the UK taxpayer billions and would steer London away from it's stature and of it's economic boom.

The banking industry in England consist of more than 12% of the economy, far more than in all the other European country's apart from Luxembourg (in the rest of Europe it's about 3 to 4%). And far more what the rest of Europe considers healthy (in the too big to fail debate). Another statistic, more than 1200 London bankers receive a yearly bonus of more then 1 million (I believe in Euro's), that's FAR more than in the rest of Europe, not country's individually, but COMBINED.

Since last year, and thanks to the banking crisis, bonusses here in NL are maximized on 20% of their annual salary (apart from a number of other measures), ofcourse to prevent Bankers taking gambles in search of their bonusses. Funnily enough it's London that pays these huge bonuses, and it's London where the investment banks of this world were allowed by law and under a laughable regulatory regime to create their off balance SPV's (which wasn't even allowed in capitalist USA), which subsequently led to London's rise as a financial center and the biggest financial crisis to date.

And that's how Europe's citizens are fooled by their governments and by the interests of other country's.

[anonymous-user]

DeltonaS said:

....far more what the rest of Europe considers healthy...

The rest of Europe would consider it perfectly healthy if it were still in Paris, Frankfurt, Madrid and Milan.

DeltonaS said:

...off balance SPV's (which wasn't even allowed in capitalist USA)...

Rubbish

Edited by anonymous-user on Thursday 31st July 17:33

[Zod]

DeltonaS said:

fblm said:

Employs 1.1m people (3.8% of the workforce) and contributes £65bn in tax (11.7%), those dummies wishing the UK's financial services industry diasappears to Paris, Frankfurt, Singapore and New York need to explain where they are going to find the replacement tax take from.

Exactly, all politics and the sole reason why London does all it's banking regulatory on it's own, apart from the rest of the EU. It's scared stless that they leave, which would cost the UK taxpayer billions and would steer London away from it's stature and of it's economic boom.

The banking industry in England consist of more than 12% of the economy, far more than in all the other European country's apart from Luxembourg (in the rest of Europe it's about 3 to 4%). And far more what the rest of Europe considers healthy (in the too big to fail debate). Another statistic, more than 1200 London bankers receive a yearly bonus of more then 1 million (I believe in Euro's), that's FAR more than in the rest of Europe, not country's individually, but COMBINED.

Since last year, and thanks to the banking crisis, bonusses here in NL are maximized on 20% of their annual salary (apart from a number of other measures), ofcourse to prevent Bankers taking gambles in search of their bonusses. Funnily enough it's London that pays these huge bonuses, and it's London where the investment banks of this world were allowed by law and under a laughable regulatory regime to create their off balance SPV's (which wasn't even allowed in capitalist USA), which subsequently led to London's rise as a financial center and the biggest financial crisis to date.

And that's how Europe's citizens are fooled by their governments and by the interests of other country's.

You have no idea what you are talking about.

[DeltonaS]

fblm said:

DeltonaS said:

....far more what the rest of Europe considers healthy...

The rest of Europe would consider it perfectly healthy if it were still in Paris, Frankfurt, Madrid and Milan.

DeltonaS said:

...off balance SPV's (which wasn't even allowed in capitalist USA)...

Rubbish

Edited by fblm on Thursday 31st July 17:33

"The rest of Europe would consider it perfectly healthy if it were still in Paris, Frankfurt, Madrid and Milan."

Well done Sir, you seem to get the tenor of my post.......

And please explain the "rubbish" part, my source is quite knowledgable on the subject......

[DeltonaS]

Zod said:

You have no idea what you are talking about.

That's the reaction of a five year old........

Eleborate Zod.......

[anonymous-user]

DeltonaS said:

...please explain the "rubbish" part, my source is quite knowledgable on the subject......

You are claiming off balance sheet spv's arn't allowed in the US. This is ridiculous. The use of spv/spe's through 'offshore' centres like delaware for all kinds of off balance sheet financing is very common in the US. It is the basis of the entire securitization industry that brought you such fine products as MBS and CDO's. If your 'source' is even a tiny bit knowledgeble then you have misunderstood. Have you heard of Enron?

[Zod]

DeltonaS said:

Zod said:

You have no idea what you are talking about.

That's the reaction of a five year old........

Eleborate Zod.......

Oh dear, let's start by looking at your own country, the Netherlands, that paragon of financial prudence:



Now go and practice your English like a good little boy (or girl). (Really quite disappointing for a Dutchie)

[DeltonaS]

fblm said:

You are claiming off balance sheet spv's arn't allowed in the US. This is ridiculous. The use of spv/spe's through 'offshore' centres like delaware for all kinds of off balance sheet financing is very common in the US. It is the basis of the entire securitization industry that brought you such fine products as MBS and CDO's. If your 'source' is even a tiny bit knowledgeble then you have misunderstood. Have you heard of Enron?

Great example Enron....not........

You might want to consult your source of why that isn't such a great example in this very case....

[Du1point8]

fblm said:

otolith said:

The same people who would be delighted if this kind of measure did drive the banking industry overseas would be the first to moan when the shortfall in tax revenues leads to cuts in benefits and services.

Employs 1.1m people (3.8% of the workforce) and contributes £65bn in tax (11.7%), those dummies wishing the UK's financial services industry diasappears to Paris, Frankfurt, Singapore and New York need to explain where they are going to find the replacement tax take from.

They will take it from the greedy rich... see how well its worked in France, its an excellent scheme, I bet Ed is upset that he didn't get to do it first and the French beat him to it.

[DeltonaS]

Zod said:

Now go and practice your English like a good little boy (or girl). (Really quite disappointing for a Dutchie)

You still haven't really got over the "5 year old" part, have you ???