Posts Tagged ‘banking crisis’
Overpaid Bankers Still Don’t Get It
John Mack, head of US bank, Morgan Stanley hit out at overpaid bankers. He said, “I still don’t think the industry gets it.” Rather than reduce the amount that bankers get paid, banks are looking at restructuring of pay agreements to defer bonuses. He warned that, “If we [bankers] don’t do something on pay the government will.”
Even banks that are making losses and under government control are still receiving bonuses. Royal Bank of Scotland (RBS), 84% owned by the government, announced losses of £3.6bn but is still paying staff more than £1.3bn in bonuses.
Bankers say that these salaries are the market rates. As an example of the huge sum that change hands, Mr. Mack cited, a trader that had recently left Morgan Stanley to work for a hedge fund. He was being paid $11m but was poached by the hedge fund for a $25m.