New look at City bonuses

[Paddy]

Exactomundo.

Even at best of their times the dividend was not far off current, presumably not highest on record, bonuses, so effectively staff that runs firm pillages shareholder money. Why the feck those shares are so high with such pathetic yield, it's not like the company has got loyal staff, or some real assets like patents? It's a baloon of hot air that should only be worth a few multiples of dividends they pay every year - at one pence dividend per share their shares should be worth 3-5 pence, not 300.

So why are they not paying shareholders any more? I think what happens here is that they get some real profits in form of real cash coming into bank and they pay it out as bonuses, however booked paper profits are on balance sheet but there is no real cash to pay dividends, so those are very low.

If that's correct, then they are effectively paying all real profit to themselves, and shareholders are left with bugger all.

I agree with you. You can be my CUK friend.

[AtW]

I agree with you. You can be my CUK friend.

If I want a friend I'll get a doggy.

[gingerjedi]

Yes, 5% that's massive

I was getting 5%+ on my savings account in "good times" (before QE and negative interest rates) ffs - why take extra risk with those shares then?

It is, 3% is the average FTSE dividend yield last time I looked.

I do agree with you though, the staff seem to be helping themselves whilst the owners/risk takers (us) are getting bugger all. The shareholders AGM should be interesting.

[AtW]

It is, 3% is the average FTSE dividend yield last time I looked.

That's why I prefer to have SKA shares

[Watto]

You numpty, at least get your numbers right. It is a 1p quarterly dividend, so the yearly yield at that rate would be 4/330 = 1.2%. Do you know what a 2Y treasury is paying at the moment?

Secondly, they won't be paying much of a dividend because they are stockpiling cash and deleveraging. All companies are. Look at Apple. How do you know Barclays are stockpiling cash? If you paid attention to the recent stress tests you'll note that their Tier one capital ratio has increased from around 9% at the height of the crisis to 13%, the strongest of any UK bank.

Now back to Apple, they are sitting on a hoard of $46bn. If you are an Apple shareholder you might be asking why that money isn't paid as a dividend, but what is most important in this climate is stability and having the resources to expand when the time comes. If you are a bank this is even more important at the moment, since if the market senses weakness you are stuffed. And as a Barclays share holder, I would rather not have a 5% dividend yield if it means the share price is in tatters.

[Random]

as above. People complain about bonuses but dont understand the mechanics behind them. Once a bank tax is implemented and better controls in some areas like OTC are added will these people ever complain about their beloved footballers? How many clubs are on the verge of administration but still paying crazy crazy amounts for the footballers and agents including bonuses etc. But "The Sun" brigade dont see a problem in this and so endlessly sit on their couch all day and complain about anything they dont understand.

[gingerjedi]

...some patronising BS...

I don't GAS about how much footballers earn and no club in this country has cost the taxpayer a penny let alone cause a recession.

The fact is bankers pocketed unwarranted bonuses whilst simultaneously bringing the country to its knees as the bonus culture encouraged them to do so.

[sasguru]

The fact is bankers pocketed unwarranted bonuses whilst simultaneously bringing the country to its knees as the bonus culture encouraged them to do so.

Bollux.
A country gets the bankers it deserves. If there was no culture of living above your means and borrowing as much as you can, the bankers would have had no market for their risky products.
The country as a whole lost its traditional virtues of thrift and moderation. There was a collective failure of common sense, rampant materialism and collective idiocy.
Those of us who invested wisely and lived within our means will now be squeezed but we're still in an infinitely better position than those mired in debt.
Personally I have no sympathy for financial hardship caused by lack of common sense and the coming austerity will only be a good thing - those who were silly will learn a hard lesson and those who were not will have lots of cheap assets to buy up.

[AtW]

Secondly, they won't be paying much of a dividend because they are stockpiling cash and deleveraging.

They are not stockpiling cash, they are using it to pay themselves large bonuses and leave shareholders with pathetic dividend.

Apple is a technology company and they (technology companies) have potential for share growth the Barclays will never have.

[d000hg]

AtW how much work do you do for your dividend? You're not entitled to dividends at all... some shares pay none. Maybe banks can lose all their expensive, good, staff and pay 5X more dividend... but shares might fall 50% in value. Would you prefer that? It's up to company owners what to do with money. You don't like how a company is run... simples, don't invest in it.