New MD's salary in AIB

I wonder if FRED the shred Goodwin had applied for the job,would he have been successful? He has after all much more experience than any of our internal candidates and is sure to have learned from his time as CEO of RBS.He has justified his big pension, because he claimed he would not be able to get a job with another bank again.I am sure that he ,like sacked premier football managers is just itching to get back into " management" again.
 


Exactly - in 2007 not today - and those kind of remuneration packages are part of why were are where we are. Banking is a very basic simple job - average skill base low - management not nearly as challenging as manufacturing environment and yet the pay at all levels is way out of kilter.

Its amusing to hear bankers complain about the pay levels and and security in the public sector - now they are public sector too but dont want to take public sector pay!
 
smiley said:
Can you back this statement up with proof please??
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Proof that some bankers have criticised the public sector?
Well these were conversations on the golf course, in the pub, over dinner with various friends who are bankers - covers a wide range of banks - I didn't think to record them.

Proof that I found them "amusing" ?
though mabye "ironic" would be a better way of putting it
 
Brendan said:
I understand that Barclays didn't have to be bailed out.

Barclays and a few other banks stuck to very conservative lending.

Is this factually incorrect?
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Your understanding is incorrect. Barclays were bailed out, under rather unfavourable terms, by sovereign wealth funds based in Qatar and Abu Dhabi.
http://www.guardian.co.uk/business/2008/oct/31/barclay-sovereignwealthfunds

They are not a conservative bank by any means. A large portion of their profits comes from their Investment Banking division, Barclays Capital.
 

Getting private capital isn't the same as been 'bailed out' no matter what price they pay. If they hadn't got the money from the funds, then they would of had to have been bailed out using public money.
 
putsch said:
Well these were conversations on the golf course, in the pub, over dinner with various friends who are bankers - covers a wide range of banks - I didn't think to record them.
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Yes, of course. Your friends opinions covers the opinions of all bankers.

I think any comments like that should be backed up by facts/sources.

So hindsight will tell me you are correct. Should have recorded them.
 
Sunny said:
Getting private capital isn't the same as been 'bailed out' no matter what price they pay. If they hadn't got the money from the funds, then they would of had to have been bailed out using public money.
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Since when has the term "bailed out" been reserved exclusively for government-led rescues? Frankly, I don't see the difference with who provides the funding to stop the company going under. At the end of the day it is still a bailout.

You have to give it to Barclays though. They were very clever in realizing that they could maintain the public image of being a "prudent" bank if they avoided support from the government. It didn't even matter that the subsequent finance they received was under worse conditions than that being offered to them by the state!!!

There is an important lesson here on how valuable the intangibles are to Finance. Image is everything.
 

Because otherwise everytime someone raised equity, you would be saying they are being bailed out. The soverign wealth funds made an investment decision based on getting an investment return not saving the bank from failure. The British Government didn't when they handed over money. They handed it over because they had to if they didn't want the banks to fail. Thats why it was a bail out.

They paid more cash for the money but Barclays did the right thing by it's shareholders. Look at what state bailouts will cost RBS and Lloyds by the time the EU has decided what parts have to be sold off. Also remember that in the midst of the crisis, Barclays bought most of Lehman's which could prove to be the best piece of business in recent corporate history and they wouldn't have been able to do that with public money. They are not a conservative bank by any stretch of the imagination and there are plenty in the market woho don't believe the Barclay's story but it has survived the worst of the financial crisis without taking a cent of public money. Not many banks can claim that.
 
Sunny said:
Because otherwise everytime someone raised equity, you would be saying they are being bailed out.
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No, I don't see it that way at all. I consider the determining factor of whether funding is a bailout or not to be the intended use of the funds.

Funding to provide support for future growth and expansion can't be considered a bail out for example. Funding to simply plug holes in the balance sheet is most definitely a bailout, regardless of whether it comes from public or private sources. Barclays was looking for funding for the latter reason last year as they were undercapitalized.

I imagine that the government would have done some kind of cost-benefit analysis before they bailed out a bank. If the amount of investment required to save the bank was less than the expected cost to the economy if it went under, then it would make sense for them to invest.
 
Call me cynical but do we honestly think that the man has taken a 150k paycut from one day till the next? I have no doubt that his mortgage has been paid for as compensation.
 
I acknowledge that this is slightly off the topic, and dont get me wrong, i think 500k is even too much, but how much do WE pay pat kenny & co? we all pay a tv licence and out of this our 'top' presenters earn more than the top management in our banks, when put into this perspective, we need AIB, BOI etc to turn the corner and return to profits as we have invested heavily in them and the salaries have been capped at 500k, so why do we continue to pay our tv personalities crazy money and people threaten to close accounts in banks over pay to guys who we need to turn things around??
apologies of you feel this to be unrelated, but I am sick of reading posts like 'leave the banks fail' and '500k is too much to pay a bank ceo' when we need our banks to survive or the country is in serious trouble & where we could do without a night of over paid tv presenters.
 
You have answered your own question.Pat Kenny is or was paid his huge salary because at the time ,he was or his agent was arguing that his salary should be that big because if he was working in a bank etc he would be getting an astronomical salary. The answer is to give Pat Kenny and co. a serious pay cut....I think 100k would be enough...I mean who else is going to hire him..BBC or TV3 or ITV?
The banks top management have a more responsible job in that they are dealing with billions and could wreck the economy if they make the wrong decisions.....oops isn`t that what they have just done, even thought they were on lotto type salaries and bonuses...and they haven`t paid back a cent by the way.
Now they are justifying their 500k salaries + bonuses by saying that banking is rocket science and no one else would do it. I for one think this is patent nonsense and we need prudent bankers and definetly not ones dabbling in complex financial instruments...one of the reasons these are complex is to obscure the explosive risk involved to the banks....the banks CEO s ignored that risk as it still gave them mega bonuses when it went bust!..... the gov. meaning you the taxpayers took the hit.
We were told that the "experience " gained would stand to these bankers....but if that was the case why didn`t they interview Fred Goodwin for a top job.I`ve asked that question before but was met with a wall of silence.
The truth is that the selection committee/directors are government appointed and are in huge fees themselves and are quite happy to pay these mega salaries...after all it is only the taxpayer is paying......and sure who cares about them.
What is wrong with capping all salaries in RTE and the banks at100k?
 
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