Further to above, I disagree with the government on this 200% cap.
I don't think it is fair for the following reasons...
People seem to generalise and think if the bank performs badly then no one should get a 200% bonus without realising there are literally hundreds of divisions.
If Banker A in one division makes £10,000,000 for the firm but Banker B in another division loses double that amount - then surely Banker A should still get a bonus for his performance despite Banker B destroying the overall performance of the bank.
It is this thinking that because some bankers brought down the performance of the bank that even the really good performers of the bank should not be rewarded which will cause RBS' recovery to take even longer.
Even if the 200% bonuses were paid to the top performers, the total compensation package is still 33% behind other banks and now that is even more.
It's not acceptable that the government can dictate the pay of even the top performers at the bank (those driving the recovery), as we've already seen, they will jump to other banks. And it's no wonder they have a recruitment issue with even junior bankers when they get slated like this.
Also some divisions carry more risk than others. It's not right that bankers working in relatively risk free divisions who make money should get slated with the guys who work in riskier divisions and lose money.
It's a decision that is purely political and has no grounding in any economic sense or reality at all.
In my opinion, other companies should adopt the incentive models of banks - where the employees get a share of the profits they generate. Even at top banks, cleaners have part of their compensation allocated to overall performance of the institution.
Posted from TSR Mobile