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Sunday, January 4, 2009

Anglo Irish bonuses take the biscuit

Just why are top executives at Anglo Irish Bank being paid bonuses? It seems that the outgoing CEO who resigned when it became public knowledge that the Chairman admitted that he had been less than transparent with his own financial dealings sanctioned Christmas bonuses when he was on the way out the door. Bonuses are generally given n the basis of achievement or reaching a target so how exactly did top executives in Anglo Irish Bank hit these targets given that the bank is now worth less than 1% of it’s value from mid 2007? One suit justified the money on the basis that he may need it as he might lose his job. Quite a number of building workers on the projects that the bank speculated on may not have a job tomorrow, will Anglo be cutting these workers a few quid? Highly unlikely!
Could it be that when commercial clients completed loans that the exec that did the deal was on a percentage of the deal as a personal bonus? If that was so in the circumstances of these commercial deals being the noose from which Anglo Irish now dangles should the bonuses not be cancelled since it is the tax payer who’s going to have to carry the can for the bad decisions made by the bank? Could the Department of Finance not indicate to the bank that in view of the states decision to rescue it, that any decisions made by the bank that exposes the bank to further liability, the directors would be personally liable for by a surcharge. If I as a councillor was to vote in favour of a proposal knowing that the funds were not there to meet the cost, I would be potentially liable for a surcharge, not so for the master's of the universe!
Now in the reality of the position the bank is in, the “significant end of year bonuses” may not push it over the edge but in a climate where taxpayers are being asked to shoulder an unfair burden of the cost of the cowboy era better known as the Celtic Tiger, a more realistic approach in keeping with prudent money management would be more in keeping with the general mood right now.
Anglo however contracted a London based financial communications firm Tavistock Communications to spin their way through for the moment. One of their former directors acted as adviser to David Cameron and John Major during the 1992 UK General Election, that’s the one that proceeded the recession. Indeed Cameron can be seen in the infamous footage of Norman Lamont on Black Monday 1992 announcing the pound’s withdrawal from the ERM. Their AGM will be held almost 90 years to the day from the calling of the first Dail in Dublin’s Mansion House at the same venue where the democratic programme of that republic was passed by the state after it was proposed by Labour leader Tom Johnson TD. The chairperson and their spin doctors may consider the following extracts at their EGM from that programme“We declare that the Nations sovereignty extends not only to all men and women of the nation but to all its material possessions…., all the wealth and all the wealth producing processes within the Nation", or “In return for the willing service we, in the name of the republic, declare the right of every citizen to an adequate share of the produce of the Nation’s labour”.
Perhaps having reflected on this they may consider forgoing their bonuses, indeed one may wonder why they need to got to the UK for advice when their HQ is round the corner from their new shareholder the Department of Finance and I wonder does the minister approve of this move given his call for patriotic action. Anyhow, there’ll be more than the ghost of zombie banks shuffling around the Mansion House at the EGM, that’s if Anglo as we know it survives that long

1 comment:

optimum said...

What are you talking about when you say "why are top executives at Anglo Irish Bank being paid bonuses"? The junior staff (who dont get paid any overtime or tea allowances like their counterparts in the clearing banks) and some middle management received a few bob. So what. The government havent invested a cent yet, but when they do Im sure the performance pay will be revised in all banks.

Start with the TDs with their allowances and you might save many muliples of the money your are complianing about here.