Today, Boris Johnson, leapt to the defense of the bankers at the annual conference of the business lobbying organisation, CBI. Along with the rest of the political elite, Boris cropped up at the conference to do a bit of subtle soft-soaping. But in what can only be described as an obvious attempt to cosy up to his rich City backers, Boris claimed:
“Not only have we got to stop vilifying bankers we need to make the moral case for banking.”
This is not an unusual Borisism: during the libor scandal Boris said he would not “run down Barclays bank” and instead declared “I’m going to stand up for financial services”.
Yet another example of Boris feeding the fat cats.
The Conservative Party hasn’t been left wanting for people going off message recently, and with elections looming tomorrow it’s unlikely CCHQ will thank one of their Essex MPs heaping praise on the richest in society as maligned martyrs to the national interest.
Banks may be hiking up their salaries to absorb their cut to bonuses, says a major economics research group. The bonus season is about to begin and banks are already dreaming up schemes to ensure they’re still raking in the same amount of cash.
Bonuses are to be slashed by 86% compared to their £11.4bn peak in 2008, but those from the city are still expected to pocket a whopping £1.6bn. Though down on four years ago, bonuses are still being announced despite a predominantly flat-lining economy.
Fears that salaries are ramping up to absorb the cut to bonuses are supported by figures from Income Data Services which found a 27% rise in overall pay and benefits to top executives despite the cut in bonuses. Only last week the ONS also revealed that salary of the highest paid employees more than doubled in real terms since 1986.
“…It’s like having a pet or a child. If you keep smacking it and you keep on shouting at it, then ultimately it’s going to cower in the corner and not do anything, it’s going to freeze.”
Scrapbook is reminded of former Barclays boss Bob Diamond’s insistence, before the Treasury Select Committee, that the banks’ “period of remorse and apology” should be over. Diamond, of course, was subsequentlyforced to resign over his role in market manipulation.
At the Conservative Party Conference earlier this month David Cameron specifically complemented Lukies, telling attendees:
“There are so many opportunities in this world. I want to tell you about one business that’s seizing them. It’s run by a guy called Alastair Lukies… He’s been with me on trade missions all over the world – and his business is booming.”
Confirming that “several” UK banks were involved in fixing the LIBOR inter-bank lending rate on Channel 4 News earlier, Bank of England governor Mervyn King was at his emollient best when asked about his role in the sacking of Barclays’ Bob Diamond.
Apparently, his board-level intervention — insisting that sacking chairman Marcus Agius wasn’t enough – was merely trying to be “helpful”.
“I had a conversation which I thought would be helpful to them in understanding how concerned the regulators were … Sometimes it’s helpful to have a third party say ‘Do you really understand how concerned they are?’, and I think they found that helpful.”
It emerged this week that the Financial Services Authority warned Barclays about Diamond’s links to LIBOR fixing before he was appointed in chief executive 2010.
Scrapbook doubts Bob will be thanking Mervyn for his “help” any time soon.
In the wake of a US Senate report into the activities of HSBC, the waters have been rising around Trade Minister — and former HSBC chief executive — Lord Green. The sub-committee found that the bank had provided drug cartels with a money laundering conduit.
Questions are now being asked about how much Stephen Green knew, and as such it’s worth looking back at something he said back in 2009, in reference to the behaviour of the likes of Sir Fred Goodwin:
“Underlying all these events is a question about the culture and ethics of the industry. It is as if, too often, people had given up asking whether something was the right thing to do, and focused only on whether it was legal and complied with the rules.”
Clearly when he was in charge of HSBC they may have even given up on the “legal and complied with the rules” bit.
A handful of executives at Barclays bank have given over $125,000 to the election campaign of Mitt Romney, filings with US regulators reveal. As banking scandals build on both sides of the Atlantic, other bank executives, including some at RBS, have also been filling Republican coffers.
Figures at a subsidiary of RBS — which is majority-owned by the British state — have donated $13,000 to the Republican candidate, whilst Barclays executives and employees have given $128,000. This comes as Barclays fights to restore its reputation after the LIBOR fixing scandal saw senior figures dropping like flies, and is only the tip of the iceberg.
Major donors include:
Patrick J. Durkin, Managing Director Of Barclays.
Thomas E. Hamilton, Head of Mortgage-Backed Securities at Barclays Capital.
Robert Matthews, Vice-Chairman of RBS’ Citizens Financial Group.
Additionally, with Romney scheduled to hold a £75,000-per-head fundraiser in London, an Early Day Motion has been put forward in Parliament, calling on Barclays to:
“cease fundraising for political candidates immediately and to concentrate entirely on repairing confidence and trust in the banking system instead.”
With Romney yet to make any grand pronouncements on finance, the likes of Barclays and RBS will be hoping for a “business as usual” approach.