Germany’s finance minister joins six other countries to call for bonus controls
The ministers, in a hard-hitting letter, appealed to their colleagues in the Group of 20 to back their demand that "a strict compensation policy be put in place."Paris -- Seven European finance ministers, including Germany’s, called on Friday for strict rules governing bankers' bonuses, arguing that in some instances the payment of such compensation has been "improper, cynical and unacceptable."
The ministers, in a hard-hitting letter published in newspapers in all seven countries, appealed to their colleagues in the Group of 20 to back their demand that "a strict compensation policy be put in place."
Exorbitant banker bonuses will be on the agenda in London later in the day as finance chiefs from 20 leading developed and developing countries meet to discuss steps to sustain a nascent recovery in the world economy.
Some banks rescued by crisis-related public assistance are continuing to distribute fat bonuses, a practice that has sparked outrage in Europe and elsewhere.
"Banks -- some of which owe their very survival to massive injections of public monies -- are taking advantage of good results for the first quarter to pretend that the crisis was only a minor setback and that they can return to business as usual,” the letter said. “We must be very clear: these practices are not only dangerous, they are improper, cynical and unacceptable. They constitute a provocation in the face of rampant rising unemployment."
The ministers, representing Sweden, The Netherlands, Luxembourg, France, Spain, Germany and Italy, said guaranteed bonuses for more than one year should be banned.
The list of signatories did not include any representative from Britain, which has shown reticence over this issue.
"Bonus payments should be spread out over a few years and paid bonuses should reflect the individuals' and banks' true performances over time," the ministers said in an English-language version of the letter appearing in the Financial Times.
They added that public opinion in their countries "finds it hard to understand how so few can claim so much."