Reply to: Dutch bankers' bonuses axed by people power

[d000hg]

I don't remember bad PR being illegal.

[SueEllen]

If those doing the bailouts didn't stipulate what the money could be used for, tough. Even if they did, the company should retrieve bonuses not the employees have them retrospectively taxed.

If your employer overpays you they can demand the money back. If they paid bonuses illegally, same applies. The government stepping in like this is moronic.

The government is stepping in because it seems those who are running the bank are completely living in another world.

The directors must have been told by a few of their pals not to hand out bonuses as it's bad PR before they did it.

[AtW]

This is one of the few times I agree with atw

I take it all back!

Bankers should be entitled to award themselves whatever bonuses they see fit regardless of who pays for it, damage to the economy they make, or just common sense - it's all good and proper: keeps taxes lower on the rest of the folk.

[Peoplesoft bloke]

I am not a socialist - I am not calling to tax to death successful companies, what I can calling is to make sure tax system is used to restore justice when criminal system is incapable of dealing with the problem - people who signed off those "triple A" securities should have been sharing jail with Madoff, rather than being retired with massive bonuses and pensions.

It's the fundamental principle - failure should not be rewarded. When company goes bust people lose jobs, they don't get bonuses! This is total socialism that bailout happens and people who are responsible for failure not only keep jobs (mostly) but also get bonuses paid out by taxpayers or even private shareholders in some cases.

This is one of the few times I agree with atw

[AtW]

If those doing the bailouts didn't stipulate what the money could be used for, tough.

Sure, whoever gave money was moronic as it wasn't their money in the first place.

That does not mean that situation can't or shouldn't be rectified later - better later than never.

[d000hg]

It's the fundamental principle - failure should not be rewarded. When company goes bust people lose jobs, they don't get bonuses! This is total socialism that bailout happens and people who are responsible for failure not only keep jobs (mostly) but also get bonuses paid out by taxpayers or even private shareholders in some cases.

If those doing the bailouts didn't stipulate what the money could be used for, tough. Even if they did, the company should retrieve bonuses not the employees have them retrospectively taxed.

If your employer overpays you they can demand the money back. If they paid bonuses illegally, same applies. The government stepping in like this is moronic.

[AtW]

That's really the ratings agencies, although I would say doesn't relieve the bank directors of responsibility.

Directors should not be making decisions solely on the basis of someone else setting a grade - frankly, proper banks should use their own brains to decide level of risks involved: having a handful of rating agencies is just sharing systemic risk (not that they cared with short term bonuses and complete lack of responsibility for their actions).

Even if directors took those ratings they should have kept an eye on liquidity and risk - being so dependent on single particular (temporarily very profitable) asset that can turn into illiquid paper was (IMHO) criminal negligence that was driven by desire to max out profits.

HTH

P.S. I used to work for a bank over 10 years ago.

[Mich the Tester]

I am not a socialist - I am not calling to tax to death successful companies, what I can calling is to make sure tax system is used to restore justice when criminal system is incapable of dealing with the problem - people who signed off those "triple A" securities should have been sharing jail with Madoff, rather than being retired with massive bonuses and pensions.

That's really the ratings agencies, although I would say doesn't relieve the bank directors of responsibility.

[AtW]

AtW how do you reconcile your hard-line socialist attitudes with the fact you are engaged in capitalist enterprise?

I am not a socialist - I am not calling to tax to death successful companies, what I can calling is to make sure tax system is used to restore justice when criminal system is incapable of dealing with the problem - people who signed off those "triple A" securities should have been sharing jail with Madoff, rather than being retired with massive bonuses and pensions.

It's the fundamental principle - failure should not be rewarded. When company goes bust people lose jobs, they don't get bonuses! This is total socialism that bailout happens and people who are responsible for failure not only keep jobs (mostly) but also get bonuses paid out by taxpayers or even private shareholders in some cases.

[d000hg]

AtW how do you reconcile your hard-line socialist attitudes with the fact you are engaged in capitalist enterprise?

[AtW]

ING is primarily a retail bank.

Good.

[Incognito]

You mean 35-40 years old ING employee leaving the bank with a few million quid in cash bonus, fully paid off house, a few luxury cars, that kind of retired employee?

Anybody in a bank who got a bonus after they were bailed out should not have received it full stop.

Specific people who made deals that failed prior to bail out should also lose bonus, and some in my view even freedom as their greed caused massive damage - they are still getting their salaries, bonuses whilst other people lost their jobs as they were not "big enough" to be bailed out.

ING is primarily a retail bank. They do not get the renumeration like the UK banks do. I believe the bonus they are all kicking off about was only £1m and even then the guy indicated he was going to refuse it.

[AtW]

If you're a retired ING employee who was always a damn good egg at your job why should you put up with seeing your pension frozen and priority given to bonusses for directors who haven't yet succeeded in paying off the company's debt to the state or reaching the necessary capital levels?

You mean 35-40 years old ING employee leaving the bank with a few million quid in cash bonus, fully paid off house, a few luxury cars, that kind of retired employee?

Anybody in a bank who got a bonus after they were bailed out should not have received it full stop.

Specific people who made deals that failed prior to bail out should also lose bonus, and some in my view even freedom as their greed caused massive damage - they are still getting their salaries, bonuses whilst other people lost their jobs as they were not "big enough" to be bailed out.

[Mich the Tester]

That's not what a bonus should be about though. Bonuses should be subjective and based on your performance, not the performance of a company as a whole.

If you are a damn good egg at your job and delivering everything you're meant to and your business unit is delivering targets and profits as predicted why should you be punished for some idiot who is in a role completely unrelated to you who fails to hit his targets?

By all means business units who do not meet targets should not get their bonus, but not the business as a whole.

If you're a retired ING employee who was always a damn good egg at your job why should you put up with seeing your pension frozen and priority given to bonusses for directors who haven't yet succeeded in paying off the company's debt to the state or reaching the necessary capital levels?

[AtW]

No, it's a good thing it won't happen; retrospective taxation and legislation would destroy the country's reputation as a safe place to do business. Even the left winged 'Socialist Party' know that and would not want to risk that reputation.

Yes, that's not ideal, bad even, however having bankers gambling future of the country and losing is much worse prospect - put a high tax up on all current bonuses paid in bailed out by the state companies, make it over 100% just to make the point.