Saturday, Feb 07, 2009
How many hospitals and schools would this build?
The Telegraph: Royal Bank of Scotland to pay staff £1 billion in bonuses
"The bank’s board has begun discussions about the bonuses with UK Financial Investments (UKFI), the body set up by the Treasury to manage the Government’s shareholdings in Britain’s ailing banks.
The scale of the plan is likely to increase public anger as the recession deepens, and add to the frustration of ministers. It comes as Alistair Darling, the Chancellor, announces in The Sunday Telegraph today his plans for an independent review of the way banks are managed, including the bonus system.".............Darling you are a laughing stock
Posted by titaniccaptain @ 09:16 PM (669 views) Add Comment
11 Comments
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1. plato said...
In law, treason is the crime that covers some of the more serious acts of disloyalty to one's sovereign or nation.
2. japanese uncle said...
It's high time we introduced 'financial extra income tax' which claims doubled tax rate for financial executives earning more than 50K.
3. quiet guy said...
They don't give a monkey's TC. I am slowly coming to understand this.
http://www.cix.co.uk/~klockstone/spath.htm
4. Lowrentyieldmakessense(honest!) said...
UKFI
they need to add a T and then rearrange
5. shining wit said...
I do hope that Crash Gordon is going to be in attendance on Wednesday for Prime Ministers questions. Or perhaps he will just play his tape recording of "World economic crisis, blah, the do nothing part (pointing), blah, better positioned to come out of the downturn, blah".
Surely Dave 'I pledge to send my kids to a state school, if they aren't too crap' Cameron can come up with at least a few killer questions? It should be easy but he appears to be going backwards and is about as good an orator as David Beckham.
"In an attempt to appease ministers, RBS has indicated that no individual banker will receive a bonus with a cash element of more than £25,000 under its plans." - Wow, the exact same amount as the average wage. I'm wondering when the riots will start this year. We in for a very long hot summer...
What's a piddling £1 billion quid anyway......That's probably the coke bill for a typical weekend in London!
6. titaniccaptain said...
@shining wit
"Surely Dave 'I pledge to send my kids to a state school, if they aren't too crap' Cameron can come up with at least a few killer questions? It should be easy but he appears to be going backwards and is about as good an orator as David Beckham."....................LOL LOL LOL ROFL..........
7. enuii said...
Perhaps this is the governments quantative easing/financial stimulation package in action. Bung the 'nationalised' bank employees wheelbarrows full of dosh for them to splurge into the economy in a random fashion, as long as they are aligned, on message and keep their mouths shut.
8. Kim123 said...
Oh no, yet another 'independent review'... can't they just do something about it instead?
9. Bryan said...
I think banks have more resources than they would like to admit. They will not change the way they do business, because they still have too much money to spend. Business will not benefit from this lack of responsibility. What is the real plan to turn things around?
Bryan
http://businessfusionpro.com
10. Seenitall said...
Now that we all own RBS is there any chance that they will remove their ridiculous logo from the middle of the rugby pitch.
It's intrusive, counter-productive and sums up the mind blowing arrogance of this bunch of idiots.
11. techieman said...
lets take the emotion out of this for a moment and try to judge it dispassionately.
First of all a bonus enables a company to award discretionary pay in good times without being compelled to provide it in bad times. This means that cost structures can be budgeted before the company's year and bonuses over and above salary cost can be provided where there has been a beneficial contrbution to the bottom line.
What seems to happen is that - in effect - some salaries of lower grade workers are maintained low but thats no problem because there is a "bonus" which basically replaces salaries not commensurate with the position. Thats an aside.
To go back to the prior argument of course bonuses do 2 things - 1. They attract staff and 2. They incentivise staff.
However a company can only afford a salary bill if they are profitable or if their owners (shareholders) support that. Therefore overall the bonus must contain 2 components. The first is how well has the company done - or more accurately how much can the company afford to pay, and second how well has the individual performed?
Lets take an example. Say i am a currency trader and i have made $100m for the bank. My salary is say $350k. What should my bonus be? WHAT if i get no bonus - wont that mean i go somewhere else?
In the article :
"In an attempt to appease ministers, RBS has indicated that no individual banker will receive a bonus with a cash element of more than £25,000 under its plans.
The remainder of the bonuses, to be paid next month, will be in RBS shares, with a large proportion of them deferred or not paid at all if an employee leaves RBS within an agreed period, or if their area of the bank makes significant losses in the following two years.
The bank has decided it will not pay any bonuses to employees who work in loss-making areas of the business."
So isnt this exactly what i have already said?
As for TCs tagline - thats pretty irrelevant "How many hospitals and schools would this build?". As things stand i do disagree with the payment of £25k only as a maximum. The bonus appeasement is just silly - the best talent will leave (there are always people that will make substantial amounts in any climate) and go elsewhere. They should allocate more to the best talent and none at all to the people that contribute nothing to the bottom line.