Bankers and Bonuses

[Stephen]

Bonuses of 100%, minimum........Are they taking the pi**

Here we are with most of the working country not having had a wage increase for years (except the government!), and many having to take wage cuts, and now the people that got us in this mess are going to be getting hefty bl**dy bonuses.



I dispare.

http://www.youtube.com/watch?v=rtZbMIn7qfQ

[Manoverboard]

Then become a shareholder and exercise your right to complain

[Silver_Shiney]

My SIL was served his redundancy notice just before Christmas from a major bank, which our beloved government now owns a great deal of, effective 31 January. This is just before the bank's staff bonuses are announced, so he will not be eligible for a bonus. Yet the new chairman is getting an obscenely high bonus. Furthermore, the redundancy package was slashed from three weeks for every year worked to one week. This was challenged by the union in the High Court, but disallowed - possibly because of Government pressure? The previous year, his bonus was £27 - before tax. He wasn't one of the counter staff, he's middle management, who single-handedly wrote a procedure that saved the bank tens of millions of pounds, and yet this is how they treat him.

It seems that the higher up the pecking order you are, the higher your bonus, while those at the bottom of the food chain get diddly-squit. Had these people actually achieved anything, then a small bonus might be in order but it is ridiculous that huge bonuses are paid by loss-making organisations to the people responsible for those losses.

They also seem to think that bonuses are a right, not a privilege or reward for good performance beyond that required in their job description.

I think I will remember to my dying day, when I worked for an IFA, taking a call from an investment banker in 1996 who wailed "My bonus is only £800,000 - how will I cope?".

Some of these people need to get a serious grip on reality.

[Stephen]

Then become a shareholder and exercise your right to complain

Can't afford to now.

[Stephen]

My SIL was served his redundancy notice just before Christmas from a major bank, which our beloved government now owns a great deal of, effective 31 January. This is just before the bank's staff bonuses are announced, so he will not be eligible for a bonus. Yet the new chairman is getting an obscenely high bonus. Furthermore, the redundancy package was slashed from three weeks for every year worked to one week. This was challenged by the union in the High Court, but disallowed - possibly because of Government pressure? The previous year, his bonus was £27 - before tax. He wasn't one of the counter staff, he's middle management, who single-handedly wrote a procedure that saved the bank tens of millions of pounds, and yet this is how they treat him.

It seems that the higher up the pecking order you are, the higher your bonus, while those at the bottom of the food chain get diddly-squit. Had these people actually achieved anything, then a small bonus might be in order but it is ridiculous that huge bonuses are paid by loss-making organisations to the people responsible for those losses.

They also seem to think that bonuses are a right, not a privilege or reward for good performance beyond that required in their job description.

I think I will remember to my dying day, when I worked for an IFA, taking a call from an investment banker in 1996 who wailed "My bonus is only £800,000 - how will I cope?".

Some of these people need to get a serious grip on reality.

I agree Alan.

They are paid to do a job just like anyone else, so why pay them even more for screwing up the country!

[kaymar]

Bonuses of 100%, minimum

huge bonuses are paid by loss-making organisations to the people responsible for those losses.

A mixture of misinformation and sweeping generalisations, methinks, gentlemen.

Bonuses are an accepted form of incentive in many pay structures and quite rightly so but they do need to be properly applied and regulated as well as being set at an appropriate, realistic level. The days of £1m bonuses paid to lower-ranking bank officials are long gone and so they should be. It is possible that a handful of very capable, very high earning bankers may be rewarded at this level in the future but I think you can rest assured that such bonuses, if received, will not be for making losses.

Without doubt, a few senior bankers made mistakes in the past and many of them lost their jobs because of it. This does not make their hard-working ex-colleagues guilty by implication and if those who remain are sufficiently successful in the future to earn an appropriate bonus then there is no reason why they should not have it. The only people affected are the Bank's shareholders and possibly their colleagues. The suggestion that the average bankers played any part in the collapse of the world economy is simply wrong.

And no, I do not work in a Bank.

[Stephen]

Bonuses of 100%, minimum

.

huge bonuses are paid by loss-making organisations to the people responsible for those losses.

A mixture of misinformation and sweeping generalisations, methinks, gentlemen.

Bonuses are an accepted form of incentive in many pay structures and quite rightly so but they do need to be properly applied and regulated as well as being set at an appropriate, realistic level. The days of £1m bonuses paid to lower-ranking bank officials are long gone and so they should be. It is possible that a handful of very capable, very high earning bankers may be rewarded at this level in the future but I think you can rest assured that such bonuses, if received, will not be for making losses.

Without doubt, a few senior bankers made mistakes in the past and many of them lost their jobs because of it. This does not make their hard-working ex-colleagues guilty by implication and if those who remain are sufficiently successful in the future to earn an appropriate bonus then there is no reason why they should not have it. The only people affected are the Bank's shareholders and possibly their colleagues. The suggestion that the average bankers played any part in the collapse of the world economy is simply wrong.

And no, I do not work in a Bank.

Mmmm. Try telling that to the rest of the country.

[Onelife]

Then become a shareholder and exercise your right to complain

Mob, share holders rarely complain they just take what is given to them which is why the company bosses can award themselve ridiculas bonuses.

Your one and only true friend....onelife

[Onelife]

My SIL was served his redundancy notice just before Christmas from a major bank, which our beloved government now owns a great deal of, effective 31 January. This is just before the bank's staff bonuses are announced, so he will not be eligible for a bonus. Yet the new chairman is getting an obscenely high bonus. Furthermore, the redundancy package was slashed from three weeks for every year worked to one week. This was challenged by the union in the High Court, but disallowed - possibly because of Government pressure? The previous year, his bonus was £27 - before tax. He wasn't one of the counter staff, he's middle management, who single-handedly wrote a procedure that saved the bank tens of millions of pounds, and yet this is how they treat him.

It seems that the higher up the pecking order you are, the higher your bonus, while those at the bottom of the food chain get diddly-squit. Had these people actually achieved anything, then a small bonus might be in order but it is ridiculous that huge bonuses are paid by loss-making organisations to the people responsible for those losses.

They also seem to think that bonuses are a right, not a privilege or reward for good performance beyond that required in their job description.


I think I will remember to my dying day, when I worked for an IFA, taking a call from an investment banker in 1996 who wailed "My bonus is only £800,000 - how will I cope?".

Some of these people need to get a serious grip on reality.

Thanks Alan, your post kinda puts things into prospective

[Dark Knight]

always a good one to fill space in newspaper or on the news

the reality I bet, is somewhat more prosaic, with only a very few getting this kind of bonus and those that do earn so far above the norm, it is almost irrelevant
I would guess 99% of the banking industry get much smaller percentage bonuses

[Quizzical Bob]

Shareholders have no say in it.

[Manoverboard]

Shareholders have no say in it.

They are the owners of the Bank and can exercise their concerns in a number of ways ...

[towny44]

Giving a bonus to staff based on both individual and corporate performance is quite common I received an annual bonus most years, but it was rarely more than 5% and in bad years nothing at all.
However I have never understood why the financial industry feels the need to pay out such large bonuses to a select group of staff predominantly in the investment side of the business. They say its necessary to retain the best staff, although I don't know whether this has ever been tested. Additionally when some of these profits ultimately prove to have been spurious, why are the bonuses not repaid, and when they make huge losses why do they still pay out bonuses.

[Quizzical Bob]

Shareholders have no say in it.

They are the owners of the Bank and can exercise their concerns in a number of ways ...

They can only vote at an AGM or EGM and they need to get their proposal accepted for a vote. In modern large companies the investment institutions hold all the votes anyway. The boards all have remuneration committees and they all cover each other's backs. The chance of a small shareholder getting anything changed are zilch.

[Silver_Shiney]

huge bonuses are paid by loss-making organisations to the people responsible for those losses.

A mixture of misinformation and sweeping generalisations, methinks, gentlemen.

In my case, more a matter of first-hand observation...

always a good one to fill space in newspaper or on the news

the reality I bet, is somewhat more prosaic, with only a very few getting this kind of bonus and those that do earn so far above the norm, it is almost irrelevant
I would guess 99% of the banking industry get much smaller percentage bonuses

The IFA I was with at the time drew the bulk of their client base from investment bankers (JP Morgan Stanley, Lehman Bros, that sort of thing). There were a lot of them and they weren't taken on as clients unless their salary was over £500,000. And that's was in '95-97. But you're quite right in that those at the coal face receive very little, if anything.

[Silver_Shiney]

Giving a bonus to staff based on both individual and corporate performance is quite common I received an annual bonus most years, but it was rarely more than 5% and in bad years nothing at all.
However I have never understood why the financial industry feels the need to pay out such large bonuses to a select group of staff predominantly in the investment side of the business. They say its necessary to retain the best staff, although I don't know whether this has ever been tested. Additionally when some of these profits ultimately prove to have been spurious, why are the bonuses not repaid, and when they make huge losses why do they still pay out bonuses.

Good question, John. If one bank decided to do the decent thing and reduce bonuses to a sensible level, then the people who expect such massive payouts would undoubtedly leave in droves to another bank that would pay. It would need every bank across the globe to agree that "enough is enough" so that there wasn't anywhere for these "hot shots" to go for the sake of insanely high bonuses.

[towny44]

Giving a bonus to staff based on both individual and corporate performance is quite common I received an annual bonus most years, but it was rarely more than 5% and in bad years nothing at all.
However I have never understood why the financial industry feels the need to pay out such large bonuses to a select group of staff predominantly in the investment side of the business. They say its necessary to retain the best staff, although I don't know whether this has ever been tested. Additionally when some of these profits ultimately prove to have been spurious, why are the bonuses not repaid, and when they make huge losses why do they still pay out bonuses.

Good question, John. If one bank decided to do the decent thing and reduce bonuses to a sensible level, then the people who expect such massive payouts would undoubtedly leave in droves to another bank that would pay. It would need every bank across the globe to agree that "enough is enough" so that there wasn't anywhere for these "hot shots" to go for the sake of insanely high bonuses.

Surely then a recession would have been the ideal time to break the circle, with jobs tight and no new recruitment the so called hotshots would have no other jobs to go to.

[Gill W]

My SIL was served his redundancy notice just before Christmas from a major bank, which our beloved government now owns a great deal of, effective 31 January. This is just before the bank's staff bonuses are announced, so he will not be eligible for a bonus. Yet the new chairman is getting an obscenely high bonus. Furthermore, the redundancy package was slashed from three weeks for every year worked to one week. This was challenged by the union in the High Court, but disallowed - possibly because of Government pressure? The previous year, his bonus was £27 - before tax. He wasn't one of the counter staff, he's middle management, who single-handedly wrote a procedure that saved the bank tens of millions of pounds, and yet this is how they treat him.

It seems that the higher up the pecking order you are, the higher your bonus, while those at the bottom of the food chain get diddly-squit. Had these people actually achieved anything, then a small bonus might be in order but it is ridiculous that huge bonuses are paid by loss-making organisations to the people responsible for those losses.

They also seem to think that bonuses are a right, not a privilege or reward for good performance beyond that required in their job description.

I think I will remember to my dying day, when I worked for an IFA, taking a call from an investment banker in 1996 who wailed "My bonus is only £800,000 - how will I cope?".

Some of these people need to get a serious grip on reality.

Your SIL has my sympathy

I was made redundant from the bank I worked for 4 years ago. However, we were very lucky in that we got a decent redundancy package - I suppose we left fairly early in the 'rationalisation' process, and they didn't realise just how many people would be slashed

Most of my colleagues found new employment relatively quickly, as all the skills we learnt over the years are in demand by other employers, so I hope he finds something soon.

The thing that upsets me is that many people lump 'bankers' into one group, and aren't interested in understanding that most people who work in banks are ordinary people, earning the national average wage - and a lot more people working in banks earn much less than the national average

[Dark Knight]

investment bankers tend to be the ones with the big bonuses
certainly not the branch staff

[Silver_Shiney]

Giving a bonus to staff based on both individual and corporate performance is quite common I received an annual bonus most years, but it was rarely more than 5% and in bad years nothing at all.
However I have never understood why the financial industry feels the need to pay out such large bonuses to a select group of staff predominantly in the investment side of the business. They say its necessary to retain the best staff, although I don't know whether this has ever been tested. Additionally when some of these profits ultimately prove to have been spurious, why are the bonuses not repaid, and when they make huge losses why do they still pay out bonuses.

Good question, John. If one bank decided to do the decent thing and reduce bonuses to a sensible level, then the people who expect such massive payouts would undoubtedly leave in droves to another bank that would pay. It would need every bank across the globe to agree that "enough is enough" so that there wasn't anywhere for these "hot shots" to go for the sake of insanely high bonuses.

Surely then a recession would have been the ideal time to break the circle, with jobs tight and no new recruitment the so called hotshots would have no other jobs to go to.

oh for goodness sake, stop talking common sense!