Ireland forces AIB to cancel bonuses

[wolves_wanderer]

550Hep said:

el stovey said:

550Hep said:

Blib said:

hornetrider said:

Blib said:

What ability? To line their own pockets with absolutely no regard to the consequences of their self serving actions?

Uh-oh.

What do you mean?

There are over 300,000 empty new builds in Ireland. Three hundred thousand! Are you suggesting that these financial wizards are not partly to blame for this?

I am guessing but only guessing that bankers don't build houses!

No but they can offer 100% loans for people to buy houses who can't afford them.

So by that rationale the financial industry is accountable for pretty much any bad thing or atrocity that has happened in the last couple of hundred years since we had an organised banking system then? As pretty much anything of any scale requires "funding" of some description so therefore as the banks control funding = banks significantly responsible?

I don't see how they are any more or less responsible than people who were stupid enough to take 100-125% loans, and lets face it, we're all happy to slag them off on here aren't we?

[anonymous-user]

Bing o said:

el stovey said:

Older people with families, kids in school etc aren't all going to relocate to bankers bonus meccas like Qatar or Dubai or Hong Kong, just because they can't still get a bonus.

Yes, they will. And are doing. A Front Office worker could expect to cut 20% off their tax bill in HK or Singapore, over 5 years, that buys you a nice pile back home (and you don't have to live in England, so it's a double benefit ).

If HK was so great why haven't they all left already? The pollution is terrible. The schools are rubbish. Housing costs are extortionate.

You might be in a situation where you are happy to relocate to HK or Singapore but the UK financial sector is full of people who wouldn't want to bonus or not.

[TonyToniTone]

550Hep said:

So by that rationale the financial industry is accountable for pretty much any bad thing or atrocity that has happened in the last couple of hundred years since we had an organised banking system then? As pretty much anything of any scale requires "funding" of some description so therefore as the banks control funding = banks significantly responsible?

Allied Irish Bank crisis blamed on 'special loans' to property developers
Bank set up six lending groups independent of high street that played a crucial role in its toxic debt, AIB sources say

Unfinished buildings and rubble at Clongriffin, a ghost estate originally designed as a small new town in northern Dublin, which now has hundreds of homes and apartments lying empty Photograph: Douglas O'Connor/Alamy
The toxic connection between Ireland's main banks and the property developers that drove the republic's construction boom in the good times included a special arrangement involving building tycoons and the Allied Irish Banks (AIB).

AIB even set up six major lending groups that were wholly independent from its high street operations which handed out loans to property developers during the Celtic Tiger years.

The value of these special loans and the period over which they were handed out was far greater than Irish authorities first imagined.

Sources within the bank allege that these special units ran up a dangerous level of loans to developers and were one of the key reasons why AIB has been forced to transfer more than €19bn (£16bn) to the National Assets Management Agency – the state body set up to absorb Irish banks' toxic debts.

AIB insists that while these lending operations were not part of its branches, they were still an integral part of the bank's business within Ireland.

If there is a single word that can be used to explain why AIB and the other banks are in crisis, it is "property".

At the end of 2008, just as the global credit crunch was kicking in, AIB had €47bn of construction and property loans.

This was €11bn more than their nearest rivals, the Bank of Ireland. By the end of that year, as Ireland stared into the worst 12 months of recession for decades, AIB's profits had plummeted by 68%.

On the ground the collapse in the republic's property market and the inability of Irish banks to release loans to first-time buyers has resulted in a series of so-called "ghost estates" springing up, not only in Greater Dublin but across many rural areas, particularly in Ireland's Midlands.

New housing developments built during the latter years of the boom stand empty. One or two families, if any, might reside in one of these monuments to the death of the Celtic Tiger.

Clongriffin was designed as a small new town in northern Dublin within a 10 to 15-minute drive to the airport and with a new Dart rail link into the city centre.

The railway station remains closed and the main street resembles a ghost town, with hundreds upon hundreds of private homes and apartments lying empty.

Its fate symbolises how the property bubble burst, and how this had disastrous consequences not only for the republic's banking system once so enthralled by Ireland's property tycoons, but also for the entire economy.

In tandem with the existence of "ghost estates", the empty properties the banks lost money on include so-called "zombie hotels", businesses that are heavily in debt but kept open and run at a loss. In terms of hotels, the Irish taxpayer has paid out €800m to buy them up.

On a macro scale, there are now estimated to be around a quarter of a million empty properties across the state which were built before the financial crisis and the chronic downturn, and which people can no longer afford to move into.

The fallout from the way the banks behaved has ended up with senior bank officials being arrested by the Garda Síochána, with several prosecutions being threatened down the line.

While there is no guarantee that the Irish taxpayer will get back any of the billions that were used to prop up the struggling banks, they may be comforted by the sight of a string of former stars of the banking industry being taken in handcuffs to Irish courts.

[550Hep]

wolves_wanderer said:

550Hep said:

el stovey said:

550Hep said:

Blib said:

hornetrider said:

Blib said:

What ability? To line their own pockets with absolutely no regard to the consequences of their self serving actions?

Uh-oh.

What do you mean?

There are over 300,000 empty new builds in Ireland. Three hundred thousand! Are you suggesting that these financial wizards are not partly to blame for this?

I am guessing but only guessing that bankers don't build houses!

No but they can offer 100% loans for people to buy houses who can't afford them.

So by that rationale the financial industry is accountable for pretty much any bad thing or atrocity that has happened in the last couple of hundred years since we had an organised banking system then? As pretty much anything of any scale requires "funding" of some description so therefore as the banks control funding = banks significantly responsible?

I don't see how they are any more or less responsible than people who were stupid enough to take 100-125% loans, and lets face it, we're all happy to slag them off on here aren't we?

I know we live in a blame culture these days but actually I don't subscribe to the notion that the supplier is at fault, By which I mean I would not place the blame for every person that gets shot at the feet of Heckler & Koch or Smith and Wesson etc. Yes I know that is perhaps an extreme parallel but a parallel nonetheless!

[singlecoil]

el stovey said:

Bing o said:

el stovey said:

Older people with families, kids in school etc aren't all going to relocate to bankers bonus meccas like Qatar or Dubai or Hong Kong, just because they can't still get a bonus.

Yes, they will. And are doing. A Front Office worker could expect to cut 20% off their tax bill in HK or Singapore, over 5 years, that buys you a nice pile back home (and you don't have to live in England, so it's a double benefit ).

If HK was so great why haven't they all left already? The pollution is terrible. The schools are rubbish. Housing costs are extortionate.

You might be in a situation where you are happy to relocate to HK or Singapore but the UK financial sector is full of people who wouldn't want to bonus or not.

And there will be plenty of people ready to take the place of these magic, irreplaceable bankers when they leave, too.

[anonymous-user]

550Hep said:

So by that rationale the financial industry is accountable for pretty much any bad thing or atrocity that has happened in the last couple of hundred years since we had an organised banking system then? As pretty much anything of any scale requires "funding" of some description so therefore as the banks control funding = banks significantly responsible?

No, the point is that If a financial institution encourages someone to borrow money who won't be able to pay it back don't you think that's bad business?

It's not about lending but irresponsible lending and then buying and selling on the debt amongst banks.

[550Hep]

singlecoil said:

el stovey said:

Bing o said:

el stovey said:

Older people with families, kids in school etc aren't all going to relocate to bankers bonus meccas like Qatar or Dubai or Hong Kong, just because they can't still get a bonus.

Yes, they will. And are doing. A Front Office worker could expect to cut 20% off their tax bill in HK or Singapore, over 5 years, that buys you a nice pile back home (and you don't have to live in England, so it's a double benefit ).

If HK was so great why haven't they all left already? The pollution is terrible. The schools are rubbish. Housing costs are extortionate.

You might be in a situation where you are happy to relocate to HK or Singapore but the UK financial sector is full of people who wouldn't want to bonus or not.

And there will be plenty of people ready to take the place of these magic, irreplaceable bankers when they leave, too.

With a shiny fresh degree in the history of fiscal studies from the former polytechnic of Bolton and a calculator!

[550Hep]

el stovey said:

550Hep said:

So by that rationale the financial industry is accountable for pretty much any bad thing or atrocity that has happened in the last couple of hundred years since we had an organised banking system then? As pretty much anything of any scale requires "funding" of some description so therefore as the banks control funding = banks significantly responsible?

No, the point is that If a financial institution encourages someone to borrow money who won't be able to pay it back don't you think that's bad business?

It's not about lending but irresponsible lending and then buying and selling on the debt amongst banks.

Actually I do agree that there were some shady practices going on and that some of the problems we have now with some good specific examples could have been avoided. However I think the whole sale bashing of the supplier (in this case the banks) and the negating of responsibility of the individuals and organisations that undertook the projects etc that used the product (money) sucks.

Also FWIW I am not in anyway in banking!

[TonyToniTone]

I don't doubt that the politicians are to blame, it's the jokers that think the banks are not equally culpable.

[wolves_wanderer]

550Hep said:

wolves_wanderer said:

I don't see how they are any more or less responsible than people who were stupid enough to take 100-125% loans, and lets face it, we're all happy to slag them off on here aren't we?

I know we live in a blame culture these days but actually I don't subscribe to the notion that the supplier is at fault, By which I mean I would not place the blame for every person that gets shot at the feet of Heckler & Koch or Smith and Wesson etc. Yes I know that is perhaps an extreme parallel but a parallel nonetheless!

OK then, if Smith and Wesson were selling guns with inadequate checks on the people who were buying them would they not bear a degree of responsibility then?

I'm not blaming banks exclusively but I feel on here sometimes that we are quick to blame individuals completely and ignore the fact that the clowns taking the loans assuming that houseprices would rise forever were at least matched by clowns on the other side assuming the same thing.

Edited by wolves_wanderer on Tuesday 14th December 10:55

[singlecoil]

550Hep said:

singlecoil said:

el stovey said:

Bing o said:

el stovey said:

Older people with families, kids in school etc aren't all going to relocate to bankers bonus meccas like Qatar or Dubai or Hong Kong, just because they can't still get a bonus.

Yes, they will. And are doing. A Front Office worker could expect to cut 20% off their tax bill in HK or Singapore, over 5 years, that buys you a nice pile back home (and you don't have to live in England, so it's a double benefit ).

If HK was so great why haven't they all left already? The pollution is terrible. The schools are rubbish. Housing costs are extortionate.

You might be in a situation where you are happy to relocate to HK or Singapore but the UK financial sector is full of people who wouldn't want to bonus or not.

And there will be plenty of people ready to take the place of these magic, irreplaceable bankers when they leave, too.

With a shiny fresh degree in the history of fiscal studies from the former polytechnic of Bolton and a calculator!

Well that will be a relief, better than degrees in how to get your front feet in the trough, which would be what their predecessors appear to have read for.

[550Hep]

wolves_wanderer said:

550Hep said:

wolves_wanderer said:

550Hep said:

el stovey said:

550Hep said:

Blib said:

hornetrider said:

Blib said:

What ability? To line their own pockets with absolutely no regard to the consequences of their self serving actions?

Uh-oh.

What do you mean?

There are over 300,000 empty new builds in Ireland. Three hundred thousand! Are you suggesting that these financial wizards are not partly to blame for this?

I am guessing but only guessing that bankers don't build houses!

No but they can offer 100% loans for people to buy houses who can't afford them.

So by that rationale the financial industry is accountable for pretty much any bad thing or atrocity that has happened in the last couple of hundred years since we had an organised banking system then? As pretty much anything of any scale requires "funding" of some description so therefore as the banks control funding = banks significantly responsible?

I don't see how they are any more or less responsible than people who were stupid enough to take 100-125% loans, and lets face it, we're all happy to slag them off on here aren't we?

I know we live in a blame culture these days but actually I don't subscribe to the notion that the supplier is at fault, By which I mean I would not place the blame for every person that gets shot at the feet of Heckler & Koch or Smith and Wesson etc. Yes I know that is perhaps an extreme parallel but a parallel nonetheless!

OK then, if Smith and Wesson were selling guns with inadequate checks on the people who were buying them would they not bear a degree of responsibility then?

I'm not blaming banks exclusively but I feel on here sometimes that we are quick to blame individuals completely and ignore the fact that the clowns taking them assuming that houseprices would rise forever were at least matched by clowns on the other side assuming the same thing.

No I fully support that a measure of responsibility is applicable to all sides but frankly all you hear on here and in much of the populist left wing press about this issue is "Big Bad Banks". To my mind a supplier of any goods or service has to be confident that its end customer can achieve what they say and are as susceptible of being "sold to" as anyone. So while I would in hindsight say to said gun maker "you need to get better" I would not be parading them in front of a judge charged with mass murder!

Edited by 550Hep on Tuesday 14th December 11:04

[Soovy]

BOR said:

This is excellent news. People are fighting back now. Listen to those piggies squeal.

They'll get paid as compensation for breaches of contract. They'll get their money, just via a different route - namely "Compromise Agreements".

This is political smoke and mirrors. The courts will not stop these payments when they are contractually agreed.




Soov - dealing with irritating ar5eholes since 2001.

Edited by Soovy on Tuesday 14th December 11:12

[singlecoil]

But the people who took the daft loans are not getting bonuses.

[550Hep]

Soovy said:

BOR said:

This is excellent news. People are fighting back now. Listen to those piggies squeal.

They'll get paid as compensation for breaches of contract. They'll get their money.


Soov - dealing with irritating ar5eholes since 2001.

Always assumed you were older than 9!

[DonkeyApple]

BOR said:

This is excellent news. People are fighting back now. Listen to those piggies squeal.

Indeed. All that will happen is that salaries will have to increase if bonuses are going to be supressed.

What many do not understand, or maybe wish to understand, is that the City bonus structure is a tool to allow you to underpay your staff. You basically offer as low a basic as possible and all sorts of re-assurances that they will be taken care of via bonuses and then you fk them over at bonus time but re-assure them that next year it will be better.

For example, the job pays £50k per annum, but you don't have to pay the guy that as you can promis him a bonus. So you end up getting the guy for £30k a year plus the hope of a £30k bonus. The reality is that you give him a £10k bonus and then let him pin his hopes on getting a better bonus next year.

The reality is that the bonus system is a very effective way to pay your staff less and screw them over.

It's only a small number of people who get the large sums that the media loves to rail about. These people are geographically mobile and so you can't squeeze them as they are genuinely able to move to an alternate jurisdiction with their families so we then lose their entire tax reciept.

The largest proportion of the bonus pool goes to back and mid office workers and is simply money that is owed to them in the first place.

If the bonus system is curtailed then banks will have to to increase slaries by a greater amount than what they were paying the back office staff in bonuses and as soon as you lose the stick and carrot effect of the bonus structure you end up with a massive and somewhat rapid drop in performance as you clearly see happen in the public sector.

The key with the AIB pool is that it is poxy and seams to be mostly owed to people who left 2 years ago. It's an easier deal to try and get out of. The Irish Govt have done a smart thing as they may well lose the fight but it will be Pyric for the bank as all blame will be on their shoulders.

[wolves_wanderer]

550Hep said:

No I fully support that a measure of responsibility is applicable to all sides but frankly all you hear on here and in much of the populist left wing press about this issue is "Big Bad Banks". To my mind a supplier of any goods or service has to be confident that its end customer can achieve what they say and are as susceptible of being "sold to" as anyone. So while I would in hindsight say to said gun maker "you need to get better" I would not be parading them in front of a judge charged with mass murder!

Edited by 550Hep on Tuesday 14th December 11:04

I get the distinct impression on here that there is a lot of criticism of individuals and less so of banks, anyhow it appears we agree on the central issue

[Soovy]

550Hep said:

Soovy said:

BOR said:

This is excellent news. People are fighting back now. Listen to those piggies squeal.

They'll get paid as compensation for breaches of contract. They'll get their money.


Soov - dealing with irritating ar5eholes since 2001.

Always assumed you were older than 9!

[98elise]

el stovey said:

550Hep said:

Blib said:

hornetrider said:

Blib said:

What ability? To line their own pockets with absolutely no regard to the consequences of their self serving actions?

Uh-oh.

What do you mean?

There are over 300,000 empty new builds in Ireland. Three hundred thousand! Are you suggesting that these financial wizards are not partly to blame for this?

I am guessing but only guessing that bankers don't build houses!

No but they can offer 100% loans for people to buy houses who can't afford them.

That was last months gripe, this month we're supposed to be kicking bankers for not lending money anymore. Do try to keep up at the back!

[KatieK]

Only bankers would think they deserve a bonus for screwing the economy up. In their world they deserve a bonus no matter what happens and poor people can just go and starve. Ireland should be throwing these people in jail.