Europe agrees to claw back bankers' bonuses
AFP
AFP - Friday, September 18
BRUSSELS, Sept 17, 2009 (AFP) - – Europe's leaders agreed Thursday on a bid to jolt US President Barack Obama into a future 'claw back' of excessive bankers' bonuses at next week's G20 summit.
"The bonus bubble bursts tonight," said Swedish Prime Minister and current European Union presidency holder Fredrik Reinfeldt seven days from pivotal talks on bonuses, exit strategies and financing climate change in Pittsburgh, Pennsylvania.
"Banks, some of which owe their very survival to massive support from taxpayers' money, should not be able to to take advantage of good results in the future pretending that the crisis was just a minor setback," Reinfeldt added.
He said not to rein in bonuses would be "a provocation in Europe -- especially when set against a steep rise in unemployment," which he said was expected to reach post-war record levels by 2010 with millions more workers tossed on the dole.
European Commission President Jose Manuel Barroso said "nothing less than a new world economic model for sustainable growth" is required.
"We must show zero tolerance for any return to the bad old ways. Our citizens are understandably horrified at reports of banks receiving public money paying exorbitant bonuses."
In a change to the draft summit declaration, the EU added in the phrase that bonuses "could be cancelled in case of a negative development in the bank's performance."
The 27 EU members also agreed to pursue "an absolute limit on bonuses, in other words a cap," according to senior European finance minister and Luxembourg premier Jean-Claude Juncker.
"The British have problems with that, like the Americans... (but) we are going to study the question," he added.
Juncker had earlier said Europe should act on bonuses "whether the Americans are with us or not."
French President Nicolas Sarkozy is driving efforts to see Brussels go further than the G20, adding that "more severe rules" on banks' capital ratios can be applied even if only within Europe initially.
Even British Prime Minister Gordon Brown said "there is no going back to the bonus structure of the past," admitting the issue had "angered the populations of almost every country."
A top US presidential aide has already ruled out fixed caps despite Obama lashing out at top Wall Street executives this week.
There was no breakthrough, however, on diverging views over the unwinding of massive government stimulus.
Brown said governments worldwide should pump out another 2.5 trillion dollars of state support over the coming year with fighting unemployment now "uppermost in our minds."
AFP
AFP - Friday, September 18
BRUSSELS, Sept 17, 2009 (AFP) - – Europe's leaders agreed Thursday on a bid to jolt US President Barack Obama into a future 'claw back' of excessive bankers' bonuses at next week's G20 summit.
"The bonus bubble bursts tonight," said Swedish Prime Minister and current European Union presidency holder Fredrik Reinfeldt seven days from pivotal talks on bonuses, exit strategies and financing climate change in Pittsburgh, Pennsylvania.
"Banks, some of which owe their very survival to massive support from taxpayers' money, should not be able to to take advantage of good results in the future pretending that the crisis was just a minor setback," Reinfeldt added.
He said not to rein in bonuses would be "a provocation in Europe -- especially when set against a steep rise in unemployment," which he said was expected to reach post-war record levels by 2010 with millions more workers tossed on the dole.
European Commission President Jose Manuel Barroso said "nothing less than a new world economic model for sustainable growth" is required.
"We must show zero tolerance for any return to the bad old ways. Our citizens are understandably horrified at reports of banks receiving public money paying exorbitant bonuses."
In a change to the draft summit declaration, the EU added in the phrase that bonuses "could be cancelled in case of a negative development in the bank's performance."
The 27 EU members also agreed to pursue "an absolute limit on bonuses, in other words a cap," according to senior European finance minister and Luxembourg premier Jean-Claude Juncker.
"The British have problems with that, like the Americans... (but) we are going to study the question," he added.
Juncker had earlier said Europe should act on bonuses "whether the Americans are with us or not."
French President Nicolas Sarkozy is driving efforts to see Brussels go further than the G20, adding that "more severe rules" on banks' capital ratios can be applied even if only within Europe initially.
Even British Prime Minister Gordon Brown said "there is no going back to the bonus structure of the past," admitting the issue had "angered the populations of almost every country."
A top US presidential aide has already ruled out fixed caps despite Obama lashing out at top Wall Street executives this week.
There was no breakthrough, however, on diverging views over the unwinding of massive government stimulus.
Brown said governments worldwide should pump out another 2.5 trillion dollars of state support over the coming year with fighting unemployment now "uppermost in our minds."
