[Closed] RBS Directors - can i have a pint of what they've been drinking please?

Hopelessly detatched from reality.

People ought to stop bending over.

When the miners started making demands like this...

Kind of goes against my gut instinct which is to say no big bonuses, but I do see the logic of needing to retain the people that are going to turn the Bank around. We need to get taxpayers money back on this 'investment' in RBS, isn't this the way to do it?

I reckon they should let them resign. It's not as if they're not replaceable. THere must be plenty less hookey bankers on their way up....

Can some explain to me why the directors of a business who had to run to the government for help after they mismanaged said business so spectacularly haven't been sacked? I realise that we had to save the banks, but why did we have to save the bankers?

[i]Hopelessly detatched from reality.
[/i]

Define 'reality' - I'm equally detached from the reality of what its like to live in an inner city sink estate, as I am from what its like to have a yacht in Monte Carlo.

I've got more of an issue with the hundreds of thousands D-List celebs get paid on the BBC than I have with bankers pay and bonus's.

I say let them resign. There'll be plenty of people waiting to fill their seats. ****s!

Have you seen the muffin man? He talks sense.

[url=

Muffin man?[/url]

What gets me is the investment bacn arm made 6 billion profit. Very good. Perhaps bonuses are earned. But they want to give them 1.5 billion in bonuses from what I read ( or was that a typo)

That can simply not be proportionate.

Call their bluff and let them resign. NO golden handshake, no enhanced pension.

let em walk, since when was it a good idea to give in to blackmail.

besides im sure with the cv they have they will not fail to find more work in the business.

Let us all turn our backs to them and bend over and get ****ed ,thats what it feels like.

Someone send me a job app. now! I'm sure I can **** up any bank for a fraction of what they want!

I know the tax payer had to bail out the banks and yes it's our money. But we none of know anything about runnig a bank so we either have to trust the directors or decide we know better and try and do a better job than the experts even if we have seen a massive failure the last few years.
It is arguable that we were all to blame for the financial crash. I mean who here doesn't have a mortgage for less than 2.5 times your income? If you have then yes you get to preach bu if not then you're complicit likethe rest of us ( including me)

As I get older, I'm really beginning to struggle with the question of how someone can be worth that much? They haven't found a cure for cancer or stopped wars.
I can understand how someone may be worth a large salary say £250,000 and a matching bonus. Seriously how can these people really be worth £1,000,000 bonuses, what do they do with it? (buy carbon bikes I guess :wink:)

I'm a RBS customer. I say let the f*****s go. I'm still eagerly waiting to read Sir Fred's obituary.

*Edit - Someone may want to check the swear filter...

I really do get what you mean about 'worth' but the problem is that the only definition of worth in the private sector is one defined by profit.

geetee1972 - Member
I really do get what you mean about 'worth' but the problem is that the only definition of worth in the private sector is one defined by profit.

I agree but these guy's have made profit for 1 year, no longevity, no sense of loyalty eaither, they'd walk away and go somewhere else who'd pay more. If all the banks had a sensible approach, they end up working for sensible money (possibly)

If as they claim, they are only doing their duty for their shareholders - why TF are they ripping off a quarter of the profits?

I really do get what you mean about 'worth' but the problem is that the only definition of worth in the private sector is one defined by profit.

But surely you can only really sensibly measure that in terms of the whole company. They lost zillions, had to be bailed out by the government. The only reason they've made tons now is by profiteering off the back of a spectacularly profitable situation created by ours and other countries government bailouts.

If we took a real private sector definition of worth, they'd have gone bust, and be on the dole now, so we wouldn't be having arguments about their bonuses. The only reason they are getting bonuses is because we paid em loads of money not to go bust.

Joe

I'm a RBS customer.

I'm actually in credit- like 5 figures in credit. I am very close to taking the whole shebang to another bank. If all the banks customers voted with their feet where would they be? The directors are answerable to their customers

Where do I send my invoice? I'd like my taxpayers money back. I didnt give anyone permission to bail them out in the first place.

I am very close to taking the whole shebang to another bank. If all the banks customers voted with their feet where would they be?

We [the taxpayer] would be a lot worse off.

Joe that's an excellent argument. Perhaps we should have let them fail.

i love the way they were blackmailing us by saying if you dont let us charge people 30 quid a pop for going overdrawn we'll have to charge everyone 50 quid a year because otherwise we wont be profitable, despite high street banking being twice as profitibale in the uk than the rest of europe (according to newsnight)

now instead of paying back their bailout loan they wanna pay themselves with it instead, because otherwise they wont be competitive and our 'investment' in them will go south, absolute bollox i have no doubt that the blackmail will work again and the government will do nothing whatsoever about it
dont let them resign, fire em

this is a very very good reason to vote lib dem
they are the only party who are actually talking about regulating the entire farcical banking system
labour have failed and i can see no sincerity in osborne or cast oiron dave to change a system that they benefit from so much already

Why didn't they let them go under?

Why didn't they let them go under?

because queues of pensioners trying to get their non-existant savings out of a failed bank would be bad

but the island is overcrowded with pensioners - let a few of them die and thats global warming solved.

Goan - lesser of two evils I guess?

Is not the best way forward a light level of reform, so that we don't kill what has been a vibrant, creative and very successful financial system?

If you regulate bonuses too far then you're simply going to drive away the talent. Similarly if you regulate the banking system too far, you'll drive capital to other financial centres that will emerge as more than ready to accommodate it.

Our financial system is core to our whole anglo-saxon model of capitalism. If you smother it, you run the risk of constricting the whole economy for decades to come.

Do they deserve bonuses? **** off! Do not be fooled into thinking that they have made these profits through being financial geniuses ( they really aren't, what they are is arrogant tosser who feel they have a god given right to 6 and 7 figure bonuses) it's down to the current monetary conditions created by the goverment.

The Daily Mash hasn't quite caught up with this one yet (give it time!) but the story they ran a couple of days ago was very good...
http://www.thedailymash.co.uk/news/business/are-you-scared-yet?-bankers-ask-britain-200911262259/

If you regulate bonuses too far then you're simply going to drive away the talent.

It certainly took a special kind of talent to create the mother of all financial crashes.

Similarly if you regulate the banking system too far, you'll drive capital to other financial centres that will emerge as more than ready to accommodate it.

Leave it as it is and continue be held to ransom, which it was when the taxpayer had to bail them out.

Our financial system is core to our whole anglo-saxon model of capitalism. If you smother it, you run the risk of constricting the whole economy for decades to come.

Anglo-saxon is a state of mind, and minds need to change.

Hang, draw and quarter Sir Fred. Then send the portions to the City as a warning to the rest of the chickenshit poltroons.

*Edit: Couldn't agree more with El Bent, right on the button.

Elbent - anglo-saxon is not a state of mind. It's a recognised system of capitalism in the same way that the alliance model is in Germany and Japan and the Dirigeste system in France.

Geetee, did you lose your job as a result of the recession brought about by the bankers greed and incompetence?

Bunch of ignorant, selfish, deluded and down right C'#t's
I hope that bank goes under BIG TIME! with no money left to bail them out, they can take them s'#t houses Lloyds with em an all.

No I lost my job because of the worst recession since the 1920s, brought about by a massive over inflation of asset values primarily in the housing market, which the vast majority of us took part in.

It's a sh*t situation, but one group of people did not cause it, we all did. Yes we need to introduce regulation to address the worst excesses of period, but castigating one group of people is reactionary and ill informed.

I find the salaries / bonuses of investment bankers fairly obscene, certainly compared to nurses / doctors / teachers / etc etc etc... but the reality of our free market economy is these people are extremely good at what they do (making profit for their employers & shareholders) and if the market dictates that's what they need to be paid then that is how it will be.

Alternatives? Well Stalin and Lenin had some great ideas, but in practice.....?

And as for the "should have let the banks fail" attitudes - really? So tell me how things would function if a couple of the main clearing banks had gone under?

Again, my leanings have always been (very) slightly left of centre, and I find the renumeration of top bankers grossly exessive, but I don't see any current alternative.

"geetee1972 - Member
No I lost my job because of the worst recession since the 1920s, brought about by a massive over inflation of asset values primarily in the housing market, which the vast majority of us took part in.

It's a sh*t situation, but one group of people did not cause it, we all did. Yes we need to introduce regulation to address the worst excesses of period, but castigating one group of people is reactionary and ill informed. "

Absolutely

Aka - I think you put the argument perfectly.

aka_Gilko "these people are extremely good at what they do" ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha , brilliant! At RBS there is plenty of evidence to suggest the contrary.

but the reality of our free market economy

Laughable

It's a sh*t situation, but one group of people did not cause it, we all did

Laudable

The Internet is great.

The resign 'threat' is only something they'd have to do if the government forced them to do something that they felt was against the interest of the company/shareholders - otherwise they would be open to legal action for not putting these interests first. Just standard company law.

Now from a taxpayer perspective, they are taking the piss - in fact they should just read the riot act to all the staff. Its an FIFO moment - Fit In or **** Off. And the vast majority of those staff will sit tight.

There is no such thing as a free economy. It has been amply demonstrated that it doesn't work properly by the even the most vociferous proponents.

If it was any other industry then it would probably have been left to die on its own. We can't let banks collapse but we can stop people like the RBS directors taking so much for ballsing stuff up so nicely.

Nurses and emergency/key workers should be getting a bonus this year. Not the directors of banks.
I would happily pay more tax for this to happen.

Ed2001 - Member
aka_Gilko "these people are extremely good at what they do" ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha , brilliant! At RBS there is plenty of evidence to suggest the contrary.

Fair comment. I assume you've never bought shiny bike parts on your credit card, taken out a large mortgage to buy a better / bigger house in a nicer area, etc etc? Undoubtedly the banks f*cked up, but look at the bigger picture, the banks pandered to the needs (wants) of their customers, who wanted (want) the good life NOW. There is a lot that is debateable about current Western society's attitude to credit, and the banks have to shoulder some of that, but to say the current economic mess is solely down to the banks is bollix of the highest order.

yes gilo and the banks have now tightened up their mortgage a cred card lending, but not it seems applied the same level of prudence to themselves

and part of the problem with mortgages are the insane prices the bonus fed elite happy to pay for property, skewing the market meaning that people need to borrow huge multiples of their salaries to be in with a chance of buying their own house

kimbers - Member
yes gilo and the banks have now tightened up their mortgage a cred card lending, but not it seems applied the same level of prudence to themselves

and part of the problem with mortgages are the insane prices the bonus fed elite happy to pay for property, skewing the market meaning that people need to borrow huge multiples of their salaries to be in with a chance of buying their own house

The "bonus fed elite" almost exclusively work in the City and hence live in London / home counties. In those areas I agree with you. The bonuses also pay for and therefore push up property prices in some holiday hotspots, eg a lot of Cornwall (esp. St Ives and a lot of the North coast.)

Outside of those areas I don't think there is a huge impact from the bonus culture (again not defending it, just accepting of the conditions that lead to it's existance).

What exactly does a great banker do so much better than an average banker?

[s]not loose as much as a bad one[/s]make sh1t loads of money for their employers

Elbent - anglo-saxon is not a state of mind. It's a recognised system of capitalism in the same way that the alliance model is in Germany and Japan and the Dirigeste system in France.

I don't think you understand. All of the above models have had to evolve to become what they are recognised as today. What you are saying is that the anglo-saxon method of capitalism is now set in stone and cannot be changed.

My view is that all of the above economic models are a state of mind or particular mindset who find such models to their advantage. They need to evolve once again to suit the new circumstances, not go back to what it was like before this crash occurred like some supporters of bankers bonuses want.

Japan has already started changing.

While talent needs to be retained in the banking industry, the mindset needs to change from get rich quick pay bankers a large bonus only a year after what has happened to what I want to see: they get paid a bonus after three or five years only.

Gonefishin wrote, "Can some explain to me why the directors of a business who had to run to the government for help after they mismanaged said business so spectacularly haven't been sacked"

They're not the same directors- not one of the current executive directors was on the board under Goodwin. The last of those left in May. All but 2 WERE sacked immediately after Goodwin was replaced.

Remember, this £1.6bn isn't going to a small group of people, it's the entire bonus pot from the top man down to the school-leavers in the local branch. TJ made a particulirily stupid comment about £4.5bn profits from the investment arm not being enough to earn them £1.5bn in bonuses, but only a fraction of the total amount goes to them.

Now, this is important. RBS historically ran a low-salary, high-benefits payment structure, because it's cheap- if you pay someone £10000 per year and a £5000 salary, you reduce your pension overheads by a third compared to if you pay someone £15000. So, to maintain an average salary they do have to keep on paying out bonuses, or alternatively raise base salaries, and the result of that would actually be a long-term financial nightmare. It also has short-term savings (people leave before bonus time and lose their entitlement) Bonuses are actually the cheap option in these cases, believe it or not.

Still, there's big bonuses in there for the top benificiaries, but most are relatively small- it's partly the size of RBS that makes the headline number so huge, even paying out £500 to every employee they have costs the best part of a hundred million quid. I don't agree with the big bonuses but the huge makority of the payouts will be relatively small, and going to people who don't earn a lot and who frankly earn it, and who did nothing to contribute to the failure of the banks.

And ps, don't give me that crap about "our money", 10% of the UK's GDP comes straight from the banks. The total cost of the banking bailout to date is IIRC around 11 years of [i]direct[/i] government profit from the banking sector.

That's ignoring the far larger indirect benefit- income tax from their half a million employees, being one. Income tax from the 4 million people whose jobs only exist because of the banking sector, and corporation tax from the companies that employ them, being another. Secondary financial benefits being yet another, ie companies that exist because of bank support. People like to say "Oh, the banks aren't lending and it's putting companies out of business" without ever conceding that this means that there are a lot of businesses that can only exist because of their banks.

And even then, most of this is a loan, it's not a gift. So, the banks are being paid back some of the golden eggs that they laid, but they don't get to keep them.

Oh, and lastly remember that the £850bn figure which the media like isn't actually the amount which has been paid out- it includes £530bn of "risk"- the indemnties to the Bank of England, the guaranteed wholesale lending. Taking the actual cost to date gives a still-horrible but less insane number.

I'm not going to say there's nothing wrong with this, I think a huge amount of it stinks- but some of what people get most upset over actually isn't quite how it looks or how it's been presented.

I think I agree with a lot of Northwind's points.

A lot of this is presented in such a way to deliberately wind up the public, and many people do tend resent those who earn a lot of money. It would be interesting to see exactly who gets what, because I do believe that the majority of it would be to worthy employees lower down the ladder who had little to do with previous failures.

The problem with letting them fail is that the UK economy is far too reliant on finance.

If some top performing banker rakes in £50m & walks away with £1m, surely that's better for the bank, (& hence the stake holding govt), than some less skilled banker raking in £10m & walking away with £200k.
How much of this is down to media created envy because these people can earn such sums ?
There used to be a sales manager where I worked who had a 911, funded (only in part) by his company car allowance. Created all manner of bad feeling, the perception that this chap was raking in loads of cash, but I gather the chap had the skills to smash sales records in pretty much every dept he worked in.

Tell them NO!. Then let them take the industry overseas. The minute they do seize all UK assets and demand immediate payment of the "loan". No longer a UK bank they no longer get UK money.

F** 'em. Oh and i'm moving banks today. Been with RBS man and boy but this is too much.

They're not the same directors- not one of the current executive directors was on the board under Goodwin. The last of those left in May. All but 2 WERE sacked immediately after Goodwin was replaced.

Are you sure?

Who's the Deputy Chief Exec. then?

Pay it.

the goverment is already up £10billion on its investment. the question really should be why is the goverment banging on about tax increases when its making billions or extra money.

Konakev, I'll be doing the same.

http://www.thedailymash.co.uk/news/business/but-the-real-word-is-full-of-poor-people%2c-say-bankers-200912042283/

Remember, this £1.6bn isn't going to a small group of people, it's the entire bonus pot from the top man down to the school-leavers in the local branch. TJ made a particulirily stupid comment about £4.5bn profits from the investment arm not being enough to earn them £1.5bn in bonuses, but only a fraction of the total amount goes to them

The story I read stated that the 1,5 billion was going to the investment arm only - I thought this odd which is why I put "is this a typo?"

NO need for personal abuse.

As for the bonus being part of the culture - tough. Put a ceiling on it of what the workers at the coalface would get and remove this from the culture of the bank. Its a tax avoidence scam

Say £1000 pa bonus max?

There is no way on earth bonus of hundreds of thousands each should be being paid

A top post from Northwind. There is a great deal behind the headlines that doesn't get reported. Most people couldn't explain how important the financial industry is to the UK, for instance.

[img] [/img]

Or know that before the crash RBS was the tenth largest company in the world.

And ps, don't give me that crap about "our money", 10% of the UK's GDP comes straight from the banks. The total cost of the banking bailout to date is IIRC around 11 years of direct government profit from the banking sector.

And even then, most of this is a loan, it's not a gift. So, the banks are being paid back some of the golden eggs that they laid, but they don't get to keep them.

Northwind - the Guardian again this morning states that the investment banking arm made 5-6 BILLION profit and wants to pay bonuses of 1.5 BILIION - this is not around the whole bank but just in the investment banking arm,

I don't think you understand. All of the above models have had to evolve to become what they are recognised as today. What you are saying is that the anglo-saxon method of capitalism is now set in stone and cannot be changed.

My view is that all of the above economic models are a state of mind or particular mindset who find such models to their advantage. They need to evolve once again to suit the new circumstances, not go back to what it was like before this crash occurred like some supporters of bankers bonuses want.

Japan has already started changing.

Elbent - that is an interesting question. The problem is that the mechanisms that allow any particular state of capitalism to emerge as dominant are buried deep within a nation state's structure. In addition, they don't act independently of each other, they tend to be mutually supportive and indeed reinforcing of each other so that you couldn't change one aspect of the system even if it were possible to do so.

The mechanisms I am referring to include things like the education system, the role of unions, the judicial system and in particular employment law, culture and of course the banking/finance system.

To illustrate my argument, consider what type of companies do well in our anglo-saxon model, for example drug companies. Devising new drugs is risky and capital intensive; our financial system is structured to provide that capital from capital markets that are structured to manage risk. You also need intellectual horse power and you need lots of people moving around, bringing new ideas with them to stimulate radical innovation. Both of these needs are met by our employment laws and our education system. In contrast, there are hardly any German drug companies (yes there are one or two but the majority are US and UK) because their financial system and employment laws inhibit the way that drug companies work. They do however, make very good cars precisely because of this.

So my point, yes no system is ever fixed, but changing our model of capitalism is not possible directly; it is something that will happen by evolution over a very long period of time.

I mean who here doesn't have a mortgage for less than 2.5 times your income? If you have then yes you get to preach bu if not then you're complicit likethe rest of us ( including me)

Oooh , oooh I get to preach, my mortgage is considerably less than 2* income (at the moment, anyway)

I mean who here doesn't have a mortgage for less than 2.5 times your income? If you have then yes you get to preach bu if not then you're complicit likethe rest of us ( including me)

Make room on that soapbox nbt 🙂

I say call their bluff.
If it turns out that they are as financially valuable as they claim and the market is as fluid and global as they claim, then if the bank's profit's decline massively we can always just up the bonuses again and advertise for some new replacements.
Possibly a naive viewpoint, but I don't really care:)

One thing I neglected to say in my last post- which I thought was going to get my balls flamed off for, maybe it's in the post :mrgreen:- is that these bonuses actually do meet all of the new guidelines from the G20, etc- clawback clauses, no cash bonuses, deferments etc. The suggestion that nothing's changed is nonsense.

Uplink, you're actually quite right, I thought he'd left. I believe he's the last one though obviously, I could be wrong!

TJ, I've just read the Guardian's article and it says that the £1.5bn "covers" that area, it doesn't say that it's only for that area. Oh, also I made no personal attack so no need to get sniffy, I said you made a stupid comment which we all do from time to time, and made no comment on the person making it. No offence intended! (FWIW you're one of the people on here I can totally disagree with and still pay attention to 😉 ) Also, I never said "bonuses are part of the culture", I said bonuses for some are integrated into the basic pay package. And I did agree that huge bonuses are inappropriate, and not just for RBS.

backhander said,

"So the banks should not pay duties to the govt like everyone else because they're big?"

I said no such thing, or anything that could sound like that.

But, what I am saying is that the current cost is still less than the (very) recent gain, and that most of it is expected to be returned, which is a long way from taking money from your pocket and giving it to the banks. I thought that was perfectly clear.

and lastly,

"I'm no banking expert (is it obvious?), but if an individual owned ~85% of a company would they not call the shots in a big way?"

The company would still have the legal responsibility to the other 15% to act in their best interests. But in any case, an 85% shareholder of a limited company doesn't have a direct day-to-day involvement in the running of the company- they have voting rights in agms and egms, just as the government does.

Fair enough northwind

As reported ont he BBC this morning, the £1.5bn bonus is for the whole group - £900mn is set aside for the bonuses in the invesetment banking arm, which is where the vast majority of the profits were directly generated.

FWIW I do agree that the big bonuses aren't acceptable, but since the problem there isn't just RBS I don't think that disadvantaging the bank we own is a very good way of going about changing that! The government has the capacity to influence the whole market, and RBS's argument isn't that bonuses are inherently right, just that they have to exist within the market- so if they genuinely do want a change, there's ways to do it and this isn't one of them.

It feels weird to be arguing in favour of bonuses because of the long term benefits though!

So the banks should not pay duties to the govt like everyone else because they're big?

I said no such thing, or anything that could sound like that.

But you're certainly inferring that somehow, due to the amount of duty paid by the banks to the govt (as everyone does) that they somehow deserve

some of the golden eggs that they laid

[i]I mean who here doesn't have a mortgage for less than 2.5 times your income?[/i]

Me!

Me!

+1

Me too 😀

I mean who here doesn't have a mortgage for less than 2.5 times your income?

I [i]do[/i] have a mortgage for less than 2.5 times my salary - a [i]lot[/i] less.

+1 Get another soap box.

Should have made them agree to a personal guarantee.

In my view if you are paid a very high salary plus significant bonus for your stirling work then you should accept the potential for failure too & be finacially liable - ie Fred Goodwin was responsible for taking over the dodgy dutch bank which helped bring RBS to it's kness & so should be on his knees too - although a nice idea this is probably unworkable as the b'stards would just "give" all their assets to their nearest & dearest. Problem really was all the politicians worshipping the words of Alan Greenspan who believed in light touch regulation - how wrong could you be....

It amazing how pretentious and arrogant these directors are to even think that they are irreplaceable is beyond belief. RBS is the worst preforming bank they should welcome there threat to leave with open arms and hold there door open for them and TELL THEM TO FORGET ANY PAYOFF GREEDY BARSTEWARDS. 😈

but I do see the logic of needing to retain the people that are going to turn the Bank around.

I'm pretty sure you could replace these ****wits with random alcoholics from Northern council estates and they'd do just as good a job.

Backhander wrote:

But you're certainly inferring that somehow, due to the amount of duty paid by the banks to the govt (as everyone does) that they somehow deserve "some of the golden eggs that they laid"

I'm inferring no such thing 😕 Deserve isn't the right word to use for stuff like this. Have they earned being bailed out, just by paying lots of tax? No. Would the government be insane to have done anything else? Yes. Deserve doesn't come into it, just pragmatism. It's the fact that they're so important for the economy that makes it pragmatic to save them though.

I'm using the golden egg line because, like Aesop says, you don't kill the golden goose, you keep it alive so you can keep getting golden eggs. It's not laying just now but it will again, there's really little doubt over that.

5thElefant, are you implying that it was RBS's investment banking arm that caused their collapse? Or that it was the current board? Neither is remotely true of course, I'm just curious which ****s you're referring to.