Banking bonuses to boom again?

By Helen Duffett | Mon 3rd August 2009 - 6:10 pm

Share prices surged today as Barclays and HSBC posted combined profits of £6bn.

The banks’ investment banking arms largely accounted for the growth, which comes less than a year after the banking system was rescued with taxpayers’ money.

From the Guardian:

“Barclays’ chief executive, John Varley, who described the tumultuous events of the last two years as “humbling”, stressed that bonuses would not be paid until the financial year ended and would be subject to tougher new rules. These are being devised by the bank’s senior independent director, Sir Richard Broadbent, who will brief major shareholders later this year.

“Varley said: “We don’t pay bonuses at this time of year. They are paid on full-year performance.”

Vince Cable, Liberal Democrat Treasury spokesman said yesterday, on the prospect of the return of bumper bonuses:

“This is appalling. The money should go to small businesses, not lining bankers’ pockets. Without the taxpayer, many bankers would be without a job, let alone a huge bonus. Their greed and excessive risk-taking led to this crisis which is now costing millions their jobs and many their homes.

“Instead of allowing a return to business as usual, the Financial Services Authority watchdog must show real teeth and force the banks to publish details of their policies on pay and bonuses, and the package details of anyone who earns more than the Prime Minister. Openness and transparency are the only ways to avoid another crisis like this one.”

Lloyds and Royal Bank of Scotland are due to publish their half-year figures later this week.

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