PreviousNext

Bankers are receiving 'Himalayan pay packages 'despite poor performance , says senior Bank of England executive

By // News | Bankers are receiving 'Himalayan pay packages 'despite poor performance , says senior Bank of England executive
Email to a friend Plain text Print version // Font size: Decrease font Enlarge font

By Becky Barrow

PUBLISHED: 18:42 EST, 24 April 2012 | UPDATED: 18:42 EST, 24 April 2012

Speaking out: Bankers¿ pay is still at Himalayan heights while their performance is in the foothills, Bank of England executive Andrew Haldane has said

Speaking out: Bankers' pay is still at Himalayan heights while their performance is in the foothills, Bank of England executive Andrew Haldane has said

Bankers’ pay is still at Himalayan heights while their performance is in the foothills, according to a senior Bank of England executive.

In a hard-hitting speech, Andrew Haldane said top financiers were on an ‘upwards-only pay escalator’ where they cash in whatever happens to profits or their employer’s share price.

‘While bank performance has fallen off a cliff, executive pay remains close to pre-crisis Himalayan heights,’ he said in a speech published by the Bank yesterday.

Mr Haldane said the pay package enjoyed by a UK banking chief executive rose by an average of 13 per cent a year for nearly two decades prior to the 2007 credit crunch. In 1989, it was £310,000 but had shot up to £2.7million by 2007.

Mr Haldane, who is executive director for financial stability, said banks were playing a game which is ‘a case not so much of keeping up with the Joneses as keeping up with the Goldmans’.

This was a reference to the American investment bank Goldman Sachs, which has been nicknamed ‘Golden Sacks’ for the pay deals lavished on its workers.

In a separate attack, the director general of the Institute of Directors will today slam the controversial pay packet handed to the chief executive of Barclays.

The bank is facing ferocious criticism over its decision to award up to £26.6million to Bob Diamond, despite its disappointing performance.

The package includes everything from his £1.35million basic salary to a £5.75million payment toward his tax bill and the cashing in of share awards made in previous years.

Unhappy: Investors are angry at the decision by Barclays to pay out £2.15billion in bonuses last year ¿ more than three times the £730million paid in dividends to shareholders

Unhappy: Investors are angry at the decision by Barclays to pay out £2.15billion in bonuses last year - more than three times the £730million paid in dividends to shareholders

Investors are angry at the decision by Barclays to pay out £2.15billion in bonuses last year – more than three times the £730million paid in dividends to shareholders.

In a speech in London, the Institute of Directors’ Simon Walker will say: ‘If some banks pay three times more in bonuses to top executives than they do in total dividends to shareholders, then I think there are questions to be asked.’

FINANCE CHIEF BLASTS 'OVERPAID' BOSSES

Overpaid, reckless and incompetent financial bosses were lambasted by the City regulator yesterday.

Hector Sants, the departing chief executive of the Financial Services Authority, used his final speech to call for integrity to replace greed.

‘Should there not be some level of expectation that people entrusted with the leadership of financial services organisations ultimately are driven by the desire to do the right thing,’ he said.

‘It should not solely be about how much we earn but also how much we care for the market’s users and their well-being.’

He said ‘non-financial performance measures’ should be reflected in pay.

Mr Walker said he was pleased to see ‘encouraging’ signs that shareholders are taking a more activist approach and voting against pay deals which are excessive.

A recent report from the High Pay Commission also attacked the ‘excessive’ pay packages given to company executives, which it said had had a corrosive impact on the economy.

Within ten years, it predicts the average boss of a FTSE 100 company will be paid a record of nearly 215 times more than the average worker.

It concluded: ‘The public is rapidly running out of patience with a system that allows those at the top to enrich themselves while everyone else struggles to make ends meet.’

Last night a spokesman for the  British Bankers’ Association said:  ‘We are now committed to ensuring that the pay structures in the  industry reflect the long-term health of the organisation that the bankers work for.’

Mr Haldane’s speech was delivered in Berlin earlier this month.

Headlines Newsview all

Muslim hate preacher was allowed to spread jihad in British mosques before London bombings

A MUSLIM hate preacher who was allowed to tour British mosques and spread the message of jihad may have planted the idea of the London ... Full story

Another reason to quit the EU: Foreigners rack up £723m NHS bill

Figures produced by the Department of Health show that, since 2007-8, the UK has paid £6.18billion in health costs for British citizens in Europe – ... Full story

ISIS warns London is next in terror video threatening non-Muslims across Europe

ISLAMIC State has issued a chilling video warning that London is next to be hit by a terror attack at least as deadly as the ... Full story

Police psychological sick leave up 35% in five years

Cases of UK police officers and staff taking long-term sick leave for psychological reasons have risen by 35% over the last five years, statistics obtained ... Full story

Panama Papers: Cameron under pressure over tax havens

David Cameron is coming under pressure to stop British overseas territories and Crown dependencies being used by the wealthy to reduce their tax bills. A massive ... Full story

Donald Trump Is An ‘Idiot’ Whose Nato Comments Are Making Putin Happy, Say British MPs

Donald Trump is an “idiot” for his criticism of Nato and is making Vladimir Putin “very happy”, British MPs have said. On Saturday, the frontrunner in ... Full story

Royal Mint mark Queen's birthday with £5 coin - which could cost you as much as £7,500

Struck by the Royal Mint they have been issued in a variety of finishes and metals, including editions in platinum, gold and silver. The coins feature ... Full story

Feeling the pressure? Cameron snaps with bizarre rant over EU referendum

David Cameron dismissed talk of a split in the Tory party and in a bizarre rant said it was just journalists “setting each others’ hair ... Full story

Leaving Europe is VITAL to protect strained NHS, warns Cabinet minister

Cabinet member and Employment Minister Priti Patel has warned the health service will be better off if the UK votes to leave the EU. She claims ... Full story

Santander cash machine ALERT: Police warn public NOT to use cashpoints over security risk

Forces in both Lancashire and Cheshire have issued alerts over the use of Santander cashpoints as customers' details may be at risk. The warning follows reports ... Full story

Holiday bargains for families as costs tumble across EU: Britons set to save HUNDREDS

Costs across Europe have plummeted as the price of food, drinks and entertainment has been slashed in resorts.  They have nosedived more than 40 per cent ... Full story

Comment on: Bankers are receiving 'Himalayan pay packages 'despite poor performance , says senior Bank of England executive

Rate this article

0

Breaking News

Ex-Navy SEAL becomes first to die in self-driving car after Tesla crash

Joshua Brown, 40, was behind wheel of self-driving Tesla Model S carHe was killed when the vehicle collided with a trailer truck in Florida in ...

Johnny Manziel gets drug ban for first four games of the season

Johnny Manziel doesn't even have a team yet, but he is already out of the NFL for the first four gamesThe troubled quarterback is not ...

Boris Johnson 'offered to pull out of Tory leadership race'

Boris Johnson supporter is said to have approached Mrs May's aideReportedly said Boris would pull out of race if she stood down by 2020Michael Gove ...

Federal election 2016: Hipster sausage sizzle options

Foodies taking sausage sizzles to next level at Federal Election 2016'Designer' options will be on offer at some polling booths across the nationInstead of the ...

Teenage girl gets stuck on a cliff she was climbing for more than an hour after becoming 'fatigued' - before being winched to safety in a dramatic rescue

Teenage girl was stuck on a cliff at Point Lookout for over an hourShe was unable to get down after becoming fatigued while climbingThe girl was winched ...

Islamic State war widow Fatima Elomar avoids jail despite being caught on the way to Syria with her four children and supplies for her terrorist husband

Fatima Elomar has received a two-year three-month suspended jail termPleaded guilty to helping her IS terrorist husband prepare to fight in Syria  Ms Elomar was arrested at ...

Sally Faulkner unleashes Instagram rant after being charged with kidnapping her own child

Australian mother, Sally Faulkner, has been charged with kidnappingCharge comes three months after botched 60 Minutes child recoveryShe slammed her estranged husband on social ...

Heartbreaking 911 logs reveal youngest Orlando shooting victim begging for help

Akyra Murray, 18, was one of the many who called 911 from PulseShe had escaped but went back in to find her friend and got ...

Michael Phelps is supported by his fiancee and adorable newborn son Boomer at the U.S. Olympic swimming trials on his 31st birthday

Michael Phelps went into the semifinals of the 200-meter individual medleyHe was supported by his fiancee Nicole Johnson and newborn son BoomerPhelps is the first male ...

Australian model Jesinta Campbell says there's positives to Eddie McGuire controversy

Jesinta Campbell says Eddie's comments started a positive conversationThe 24-year-old model said men stood up against Eddie McGuire's 'joke' Eddie McGuire said he'd pay $50,000 to see Caroline Wilson ...