Lunchtime links: Gargantuan guarantees at RBS
RBS's chief executive Stephen Hester last week hinted that the bank might need to pay out generous packages to attract "rainmakers" and now it's emerged just how deep its pockets are.
The 70% state-owned bank has recruited Antonio Polverino (as we reported earlier) on a 7m one-year package and has also bagged Bruce Van Saun, previously at Bank of New York Mellon, who is also unlikely to be cheap. The total spend on this star pair is believed to be around 10m.
In fairness to RBS, it's only following the lead of its competitors in offering generous guarantees (even if it will provoke more anger than other institutions), but the timing of the revelation is likely to be a source of embarrassment for the government.
Amid a cloud of negative soundbites around the FSA's revised remuneration code (apparently it's "thrown in the towel", "pulled its punches" and "capitulated at the first sign of dissent", according to various commentators), Lord Myners, the financial secretary, has vowed to get tough.
"The short-term bonus culture in the global banking industry must end. The government is pursuing all options to ensure banks can no longer get away with the risky pay and bonus policies that contributed to the financial crisis," he said.
Meanwhile, Hector Sants has said that politicians have "ducked" the issue.
Wall Street readied for new pay template (Bloomberg)
"It's not a problem if jewel thieves decamp to, say, Zurich. But - hard as it is for some to accept - it matters to the UK if bankers do. Mayfair without armed robbers would be a better place. The City without appropriately incentivised bankers would not." (FT Lombard)
Citi brings in headhunters to assess if the management can cut it (Financial Times)
US securities industry is still shedding staff (Financial News)
Merrill culture will not be eroded, insists new BoA wealth chief (Bloomberg)
Citi's $100m trader should be exempt from Fed compensation clampdown (Deal Book)
Bonus caps are not just an issue for bankers (Telegraph)
Germany and France officially out of recession (Guardian)
Hector Sants could scarcely have garnered more publicity for himself this week had he dressed up in a Fathers for Justice-style Spider-Man suit and stood at the top of Canary Wharf with a banner and megaphone, blaring: "Look at me, look at me". (Independent)
