More Banking Bonuses

Another cut in interest rates to just one per cent has been applauded by hard pressed mortgagees – though lenders have not said how much will be passed on to householders.

It seems astonishing that outfits such as Northern Rock – owned by the government and saved from by collapse by a massive injection of taxpayers money – can still be obdurate in passing on cuts in full.

This, then, in the face of government exhortations and finger-wagging at the banks. Northern Rock has been told bluntly by the Prime Minister to stop taking money out of the markets and to start lending again.

The brazeness of the banks is leaving people incredulous at their continued arrogance. The Times has a front page lead today in which its distinguished banking editor Patrick Hosking and Philip Webster its political editor say that the Royal Bank of Scotland is still going to persist in paying thousands of its traders and senior players big bonuses.

RBS – which is now nearly 70 per cent government owned - has been bailed out with more than £20 billion of public money. The Times suggests that the bonus payments are likely to reach tens of millions of pounds – and could even be hundreds of millions.

Yesterday President Obama spoke out against a culture which rewards US bankers for failure and which pays bonuses out of tax payers money. He has capped salaries and bonuses.

The pressure is on Gordon Brown to follow Obama’s lead. So far Brown has implored UK banks to act responsibly and to demonstrate sensitivity at a time when unemployment is rocketing.

The banks in the UK have been given everything by the government which they asked for. They have been quick to pocket taxpayers money but are still behaving in a way which puts shareholders and executives’interests above the national interest.

The cry for more punitive action against recalcitrant UK bankers is growing. As are the demands that executives and directors of failed banks who are leaving with bonuses and pensions should be tried as criminals and be stripped of their monies and pension pots.

A well-placed City source said: “ The bankers are behaving in a disreputable manner. They look as sleazy as spivs and they will never be forgiven by the public for putting their own interests above those of the nation. The British have long memories.”