Germany’s bonus ultimatum to bankers

Source: FT

By Chris Bryant in Berlin and James Wilson in Frankfurt

Published: August 14 2009 20:33 | Last updated: August 14 2009 20:33

German bankers could be forced to repay bonuses if it transpires they have taken unjustifiable risks when making deals, the country’s financial regulator warned on Friday.

Bafin, the regulator, unveiled a set of risk management standards in response to the excessive risk taking and false incentives, which policymakers agree contributed to the financial crisis.

Outcry at bankers’ bonuses is widespread in Germany, where the financial crisis confirmed a public suspicion of so-called “Anglo-Saxon” financial engineering. The corporate sector is best-known for family-owned companies that take a long-term outlook, while the bonus culture of banking was anathema to many Germans.

From January 1 all German banks will be obliged to implement new pay structures that outlaw short-term incentives.

Read more: http://www.ft.com/cms/s/0/9b6ecade-8906-11de-b50f-00144feabdc0.html

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Angela Merkel will attend the next G20 summit in Pittsburgh in September to implement a global charter for sustainable economic development

or how to manage it conservatively, or efficiently, or without engaging in socialism.

Lest we forget:

:sarcasm:

Seriously, though, it is an absolute crime that anyone in the US thinks that these perverse short-term incentives that are employed in the US corporate sector are anything but counterproductive.

They will leave their banks and work elsewhere if they don't get their bonuses.

Britain may tighten laws on bankers' pay: Darling
Reuters

By Peter Griffiths Peter Griffiths – 1 hr 40 mins ago

LONDON (Reuters) – The British government is prepared to tighten the laws on bankers' pay and bonuses if companies continue to reward excessive risk-taking, finance minister Alistair Darling told the Sunday Times newspaper.

Darling said in an interview on the paper's website that he understood public concern over high salaries at banks, many of which sought government support during the credit crisis.

"If we need to change the law and toughen things up, we can do that," he was quoted as saying.

"The public is rightly concerned because the taxpayer has had to stand behind a number of these banks, and the whole banking system, in effect. So people want to make sure we don't get ourselves into this situation again," he said.

http://news.yahoo.com/s/nm/20090815/bs_nm/us_britain_banks_darling

Sarkozy summons French bankers on bonuses, credit
08.07.09, 07:41 AM EDT

By Estelle Shirbon

PARIS, Aug 7 (Reuters) - President Nicolas Sarkozy piled pressure on banks to refrain from paying substantial bonuses to traders by summoning them on Friday to a meeting on an issue which has generated controversy in France.

Sarkozy instructed top banking executives to report to him on Aug. 25 on their bonus policies, as well as on whether they were living up to commitments to keep credit flowing to businesses and families, a statement from his office said.

'The president wants to make sure that French banks are following the rules agreed at the London G20, particularly in terms of remuneration,' the statement said, adding that Sarkozy wanted these rules to be applied 'firmly'.

http://www.forbes.com/feeds/afx/2009/08/07/afx6753578.html

And they will be better protected, unlike the U.S., when the next crash comes.

that's sounds familiar

they are above the law.

Only thing stopping us from shutting down the incentives for going for the short term, this quarter payoffs at the expense of the long term is the will. Take away the obscenely inflated bonuses and the incentive is gone.

He is currently on vacations and I bet he went apoplectic when he heard about the bonuses on the radio or TV...

he has good ratings now and it's exactly the kind of messages that piss off the French opinion

I bet he picked up the phone and called the bankers association secreterary :

"tell this bunch of fuckers that I want to see them in my office the 25th at 8 in the morning. All of them. No excuses or they will be frogmarched to Cayenne on my personal order !"

and he hung up. Carla had to come in and calm him down the way only women can do...

:evilgrin: