RBS Directors – can i have a pint of what they've been drinking please?

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  • RBS Directors – can i have a pint of what they've been drinking please?
  • 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.

    CaptJon
    Member

    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.

    b r
    Member

    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.

    ojom
    Member

    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.

    aka_Gilo
    Member

    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.

    Premier Icon kimbers
    Subscriber

    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

    aka_Gilo
    Member

    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).

    ooOOoo
    Member

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

    Junkyard
    Member

    not loose as much as a bad onemake sh1t loads of money for their employers

    El-bent
    Member

    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.

    Premier Icon Northwind
    Subscriber

    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 direct 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.

    Premier Icon allyharp
    Subscriber

    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.

    Premier Icon takisawa2
    Subscriber

    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.

    kevonakona
    Member

    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.

    uplink
    Member

    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?

    Dirtynap
    Member

    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.

    Premier Icon Coyote
    Subscriber

    Konakev, I'll be doing the same.

    TandemJeremy
    Member

    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

    CaptJon
    Member

    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.

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

    backhander
    Member

    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.

    So the banks should not pay duties to the govt like everyone else because they're big?
    Where does the banks profit come from, is it not the UK taxpayer (directly or indirectly)?

    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.

    WTF?? We all pay tax, would we get some of it loaned or paid back to us if we were incompetent with our money?
    You do make some valid points but these comments smack of the arrogance which makes people hate bankers.
    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? Are the banks being balshy just because it's the Govt (who we all know are idiots)?

    TandemJeremy
    Member

    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,

    geetee1972
    Member

    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.

    nbt
    Member

    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)

    uplink
    Member

    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 🙂

    IanMunro
    Member

    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:)

    Premier Icon Northwind
    Subscriber

    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.

    TandemJeremy
    Member

    Fair enough northwind

    bristolbiker
    Member

    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.

    Premier Icon Northwind
    Subscriber

    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!

    backhander
    Member

    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

    .

    grunty
    Member

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

    Me!

    Premier Icon BoardinBob
    Subscriber
    Ed2001
    Member

    Me too 😀

    druidh
    Member

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

    I do have a mortgage for less than 2.5 times my salary – a lot less.

    oldgit
    Member

    +1 Get another soap box.

    Should have made them agree to a personal guarantee.

    Dickyboy
    Member

    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. 😈

    5thElefant
    Member

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

    These are the same **** that bankrupted it in the first place.

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

    Premier Icon Northwind
    Subscriber

    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.

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