Well would you look at that? Someone is interested in confronting mainstream bankers and infuriating them. This cuts to the central issue of banks affording fat bonus checks and never experiencing the downside of their gambles. Let them put their own skin in the game so when their gambles fail, they pay for it instead of everyone else. The bankers can brag about BABs but at least they are going to make them pay a price for their arrogance.
City banks that pay out lavish bonuses for short-term profits will be forced to set aside a bigger cash cushion against losses, Alistair Darling will announce this week, as he sets out the government's plans to crack down on the practices that led to the credit crunch.The most important addition will be to properly coordinate policies such as this across the world or at least in the most critical trading countries such as US, UK, Germany, France and Japan. The more coordination and agreement, the better the end result will be for everyone else. It's time to quit indulging this pampered bunch and get serious about reform.
With the darkest days of the financial crisis apparently over, bankers in the Square Mile have quietly begun to use the phrase "BAB", or "bonuses are back," to signal their hope that the era of outsize pay packets is returning. US bank Goldman Sachs is expected to pay out the biggest bonuses in its history this year, on the back of bumper profits.
But government ministers have stepped up their rhetoric against the City's bonus culture in recent days, with Lord Myners railing against "weak and lazy" remuneration committees that wave through generous payouts.
As part of measures to re-regulate the banking sector, due to be announced on Wednesday, the chancellor will tell the Financial Services Authority that it must treat banks that pay out large cash bonuses on the basis of short-term targets as riskier than their rivals, and force them to hold more capital.
