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Banks told not to pay dividends or bonuses

Discussion in 'Personal' started by Shedman, Apr 1, 2020.

  1. Shedman

    Shedman Star commenter

    https://www.bbc.co.uk/news/business-52114410

    Some of the UK's biggest banks have agreed to scrap dividend payments and hold onto the cash, which may be needed during the coronavirus crisis.

    The Bank of England welcomed the decision to suspend the payments to shareholders and urged the banks not to pay bonuses to senior staff either.

    The banks, which include NatWest, Santander and Barclays, were due to pay out billions to shareholders.

    But in recent days they have come under pressure to hold onto the money.

    'A sensible step'
    The deputy governor of the Bank of England, Sam Woods, wrote to some banking bosses asking them to suspend dividend payments. He asked them to confirm their decision by Tuesday evening.

    In a statement, the Prudential Regulation Authority, which is part of the Bank of England, said: "Although the decisions taken today will result in shareholders not receiving dividends, they are a sensible precautionary step given the unique role that banks need to play in supporting the wider economy through a period of economic disruption."

    Between them, Lloyds, Royal Bank of Scotland, Barclays, HSBC and Standard Chartered were expected to pay a total of £15.6bn to shareholders, according to analysis from investment firm AJ Bell.

    So let's see if I got this right. We are in the biggest financial crisis since the crash the banks caused in 2008 and the taxpayer had to bail them out which led to a decade of austerity but the banks were ready to pay out billions to shareholders and bosses while thousands, if not hundreds of thousands of otherwise profitable businesses would have to close because they couldn't get bank loans thus causing recession and a huge increase in unemployment which the taxpayer would again pay for and the banks have to TOLD not to do it by the Bank of England?

    Do these banking types actually give a damn about the society that keeps their profits rolling in or look beyond the next bonus payment?
     
  2. Rott Weiler

    Rott Weiler Star commenter Forum guide

    Before you get too carried away with an anti-banking tirade bear in mind that shareholders such as pension funds and insurance companies rely on the dividends paid to them by banks (and other companies of course) to fund the pensions and annuities they pay out, the payments under life insurance polices, etc. So if you cut off the flow of dividends for long enough it's pensioners who may suffer. But maybe that that won't worry teachers in TPS who get their money direct from the government in a gold plated DB pension scheme?

    Very few shareholders are top-hatted billionaire capitalists wallowing in the misery of the lumpen proletariat.
     
    needabreak likes this.
  3. Shedman

    Shedman Star commenter

    :( First reply and already the basis for my rant has been undermined.
     
    Rott Weiler likes this.
  4. Rott Weiler

    Rott Weiler Star commenter Forum guide

    Not entirely, I was only talking about shareholders, I thoroughly approve of your rant about their executive bonuses!
     
    Shedman likes this.
  5. dumpty

    dumpty Star commenter

    Won't it just be as last time, that once the dust has settled they just award double bonuses?

    Same with the bill to bail out most workers, it is more a credit card arrangement with Boris - the bill will be sent to each and every worker when this is done.
     
    Laphroig likes this.
  6. Shedman

    Shedman Star commenter

    :)
     
  7. Jude Fawley

    Jude Fawley Star commenter

    In a few months time the only use a credit card will be is to open a lock on the door to a cellar under a burnt-out shop. But you'll have to seek shelter somewhere.

    I'm really amazed how people can't break out of their mindset. Remember coherence and how it is all about stickiness i.e. adherence to previously accepted notions.

    It's time to tear up everything you ever believed in and shift your head into survival mode.

    I'm so thankful I come from poverty and know the terrain.

    Many of you will fall back and be subsumed on the great march.
     
  8. florian gassmann

    florian gassmann Star commenter

    Just to undermine it a bit further, taxpayer support for the banks was in the form of loans, which were paid back and share purchases which were sold back, and not grants.
     
    needabreak likes this.
  9. Luvsskiing

    Luvsskiing Established commenter

    I hope EasyJet aren't expecting any kind of bailout from taxpayers?

    https://www.thelondoneconomic.com/t...s-airline-appeals-for-taxpayer-support/21/03/

    This was utterly disgusting, as is the way EasyJet are erecting barriers to customers trying to get their money back from flights that EasyJet themselves decided to cancel, by telling them to call their totally over-worked under-staffed call centre by phone.

    If they go bust, so be it. I won't be shedding any tears.
     
  10. needabreak

    needabreak Star commenter

    Their employees might though.
     
    LondonCanary likes this.
  11. LondonCanary

    LondonCanary Star commenter

    It depends. Bonuses cannot exceed 100% of salary or 200% with explicit shareholder approval.
    (This change in the law actually led to guaranteed higher base salaries rather then the variable pay of large performance related bonuses)
     
    dumpty likes this.
  12. a1976

    a1976 Established commenter

    I also hope MAT's will not benefit but only teachers, TAs, and other staff who work in them.
     
  13. LondonCanary

    LondonCanary Star commenter

    How do you think they could obtain a benefit?
     
    needabreak likes this.
  14. Shedman

    Shedman Star commenter

    :(:(
     
    Alice K likes this.

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