Banks can't splash the public's cash

The Banker

As a shiny new shareholder in these banks, John Taxpayer gets to vote on senior executive reward packages anyway. It would be a bloody stupid board of directors that put forward a remuneration scheme which was opposed by its largest shareholder and they didn't think to check first. But then again....

Seasurfer1

Congress is after blood. When the Lifeboat reaches dry land, get ready for retribution from the US gov against the casino bankers. Congress will seek punishment, which could go as far as sequestration of the vulgar bonuses paid to the gamblers. Swish beachside properties etc will be the focus as they are taken back and returned to the Taxpayer.

max

Unfortunately the banker is wrong. Because we, the taxpayers, are taking prefernce shares which have no voting rights we have no capacity to influence executive pay. This is in contrast to the holders of Common shares which can vote down pay packjages in the manner which he suggests.
The advantage of taking prefernce shraes is that we get a div payout prioritised above that of the Common shareholders. However I, for one, would feel more comfortable if we added a rider to the contract in the way described by James Forsyth

Hardrada

We are getting preference shares though Mr Banker which would mean we don't get a vote as an ordinary share holder would.

James

The Government as a major shareholder should demand a seat on any compensation and remuneration committee of the banks affected.

The bonus argument by the Tories doesn't actually go far enough. All banking staff generally get bonuses - not just the directors. All bonus pools should be removed whilst banks are dependent on public finance.

Sir Buffy de Vere Spoofington, Bt

I would think that for £50b cash down we could ask for preference shares which had votes? Or will the banks charge us extra for that?

Wily Trout

Perhaps as state employees the bankers should be subject to the Hay Job Evaluation Scheme.

Bocephus

Crazy. Doesn't the (non-dom) guy running Northern Rock get 90k a month. What about the BBC, Jonathan Ross gets 6m.

Obviously people like Goodwin & Hornby should be kicked out but how on earth are you going to get top people to run some of the biggest banks in the world for 190k a year.

Mark (not a banker)

No, no and thrice no!
The Government should not interfer in the running of the banks. There is worrying talk about requiring them to offer easy terms to small businesses -as if it wasn't imprudent lending which started this mess.
As for executive pay, the government pays far more than £189,994 to many senior executives. Also the Prime Minister enjoys 2 houses as Prime Minister, a third as an MP and a fantastically generous and guaranteed pension.

simon

Our stake should mean we represent the public interest, not play politics.

That means (a) getting the money back and (b) a successful banking sector.

The problem is cameron was sounding like he might trade these off for (c) no bonuses. And that would be foolhardy

The Banker

Shares have whatever rights are written into them when they are issued. Prefs have a preferential right to any dividends but I don't see why they couldn't have voting rights. I agree that wouldn't be the usual case for listed bank prefs but, ahem, this is a usual case. Indeed, if John Taxpayer is going to get a guaranteed seat on the board and has all sorts of grand plans for these banks I don't see how that can be enforced unless the prefs have voting rights. "Thank you for your valuable contribution, Mr Treasury Stooge, but we other 17 directors are voting against your suggestion." £50 billion is rather a lot to venture on trust, don't you think?

Nick

Perhaps this idea of an upper limit on compensation to be not greater than the PM's salary could also be applied to the Chief Executives of Newham, Suffolk, Islington, Hertfordshire and Durham Councils, all of whom get paid between £200,000 and £240,000 pa, not including bonuses or pensions.

Andrew Zalotocky

Limiting executive pay won't do anything to keep the banks afloat or stabilise the financial sector. Nor will it make any significant difference to the potential cost to the taxpayer of this bail-out. Bashing the fat cats is just cynical populism and the Tories should be mocked for indulging in it.

Sir Buffy de Vere Spoofington, Bt

The banks have to be made accountable to our democratic representatives. Clearly MPs are exactly the best people to rein in the excessive bonuses and expenses charged by the bankers.

Paul B

It also means-when & if- we get our money back, we do a Palin-that is.The money is returned in the form of a tax rebate, lump sum, not a dribble here, dribble, to each and every taxpayer, not disappear into the swamp of government spend. This needs to be ring fenced , triple times with razor wire on the top with a 50mm gpmg every hundred yards to stop the fat cats in the public service even thinking of touching it.

TrevorsDen

We are hearing a lot about £50 billion but in fact it is 'only' £25 billion in the first instance and that is in effect just the valuation given to the agreement where the banks jointly and overall reducing (increasing) some ration or other by 1%. there is something funny about the Nationwide and Abbey being included in this.

The FT front page says that not all banks are thinking of taking this up - they are looking to outside sources.

Lets not forget who started this weeks crisis - Darling with his fatuous statement on Monday followed by a leak from Downing Street. "Now tell me Watson, just who benefits from this 'crisis'?"

john problem

It's really not so bad. Bonuses this year will be £3.5 billion (a handy percentage of the bail-out) compared with £8 billion last year. That's only a 55% drop. We can put up with that, can't we?

Hall

Wouldn't it just be a whole lot easier if the attorney general were to announce that the courts will not enforce any debt arising out of credit derivatives, just as they do not enforce any other form of gambling debt?

Fergus Pickering

What is cynical about populism? The Romans used to drag such people naked through the streets with hooks and throw them in the Tiber. Now THERE's a thing. Starting wit that prat Applegarth and that superprat Hornby. Butchered to make and English holiday, don't you know?

Hysteria

The issue of salary and bonus is a red herring in my view. Of course execs should be handsomly rewarded WHEN THINGS GO WELL.

And if I was on a compensation committee I would certainly be setting metrics that look well beyond a quarterly or annual horizon.

Debating who gets paid how much, and demanding caps is crazy talk - good for Obama and the UK in the 1970's - but not for us today please!

Mike

I want to know why Brown is handled with kid gloves on this and yet Cameron who has no control over anything is hammered into the ground.
It should be the other way round but having just watched yet another interview the bias of certain parts of the TV media is now so obvious its sickening. Cameron is asked questions that whatever answer he gives woudl be wrong but Brown gets underarm bowls at every opportunity. If the Tories were in power now they would be hung drawn and quartered but on every new broadcast abour are feted and protected despite being the main cause of this.
The latest new bulletin had a council memeber saying their money was put into Icelandic Banks because the Government told them too. Yet Brown pops up and blames everything on everyone else but is totally unchallenged.
WHAT THE HELL IS GOING ON!!!!!

Puncheon

We used to put fraudsters and crooked businessmen in the stocks for a few days and all get to throw rotten fruit and other things at them. I do begin to see the point now....