the banks again

bobblepuzzle

Dravokivich wrote: »

The wage structure within the Banks should not be an issue at all. The lending policies and how these businesses operated comercially is what needs to be addressed.

Presumably you mean the passed wage structure?

Contracts for the top dogs aren't being made the same anymore, thank christ!

Dravokivich

Cmdr Keen wrote: »

Presumably you mean the passed wage structure?

Contracts for the top dogs aren't being made the same anymore, thank christ!

Either/ Or, to me the concern should be it's comericial interests and practsises.

thebaz

Dravokivich wrote: »

The wage structure within the Banks should not be an issue at all. The lending policies and how these businesses operated comercially is what needs to be addressed.

i disagree, it should be an issue, when the 3 worst performing banks are now nearly state owned - most people when they perform poorly in the private sector, will be removed with no bonuses or extras, why should bank execs be treated differently - oh cause they gave 20 years service , which produced bankruptcy and a horrific burden to the state

ascanbe

Dravokivich wrote: »

My Thomas Cook reference was to show that when people get fussed over big wages / bonus payouts to company execs, they are actually missing the point on what the problem is...

The wage structure within the Banks should not be an issue at all. The lending policies and how these businesses operated comercially is what needs to be addressed.

You're missing the point; Thomas Cook or any other private institution can pay whatever bonuses/wages they like.
It's of no concern to the public and if they go out of business, that's for them to deal with.
This would also have been true of AIB, Anglo etc; except they haven't had to face the rightful consequences of their catastrophic mismanagement.
If the market was allowed take its course they would be out of business.
They have been bailed out by the taxpayer; so it is very much of concern to said taxpayers if those who steered the ship towards disaster are now being rewarded for this.

Dravokivich

thebaz wrote: »

i disagree, it should be an issue, when the 3 worst performing banks are now nearly state owned - most people when they perform poorly in the private sector, will be removed with no bonuses or extras, why should bank execs be treated differently - oh cause they gave 20 years service , which produced bankruptcy and a horrific burden to the state

In my opinion Baz, the banks that were bailed out should of been left to flush down the jacks...

But since they've been provided with Cash by the Government, they've the money to payout, to whoever they are due to pay it out. As long as they get their shít right commercially this time around, I couldn't give a rats arse how they manage their wages / bonus' and see it as a non-issue.

bobblepuzzle

Dravokivich wrote: »

Either/ Or, to me the concern should be it's comericial interests and practsises.

It was up to the regulator and by extension the government to ensure that the stupidity of the past didn't happen... it did, and all in the commercial interest of the bailed out banks. As long as they are cleaning up their act, that is fine with me

Dravokivich

ascanbe wrote: »

You're missing the point; Thomas Cook or any other private institution can pay whatever bonuses/wages they like.
It's of no concern to the public and if they go out of business, that's for them to deal with.
This would also have been true of AIB, Anglo etc; except they haven't had to face the rightful consequences of their catastrophic mismanagement.
If the market was allowed take its course they would be out of business.
They have been bailed out by the taxpayer; so it is very much of concern to said taxpayers if those who steered the ship towards disaster are now being rewarded for this.

The banks that have been bailed out are still Private Institutions...

bobblepuzzle

Dravokivich wrote: »

The banks that have been bailed out are still Private Institutions...

The government now owns a majority stake in Allied Irish Banks... how you could call that a privately owned institution is bizarre... it's effectively controlled by the tax payer...

That said, the government will off load its stake as soon as possible

ascanbe

Dravokivich wrote: »

The banks that have been bailed out are still Private Institutions...

Indeed they are. But they have been de-facto nationalised; without state intervention they would be bust.
The government, giving that they're pumping mind-boggling sums of money into these institutions should have demanded certain things in return; they have chosen not to.
For the optics of the situation, if nothing else, it should have been ensured that those responsible for the banks mismanagement are not seen to be rewarded for it.

TelePaul

fluorescence wrote: »

People couldn't have taken out those huge loans if lending institutions had had more sense than greed.

You're right - damn the banks for giving us what we asked for! How dare they!

TelePaul

thebaz wrote: »

i disagree, it should be an issue, when the 3 worst performing banks are now nearly state owned - most people when they perform poorly in the private sector, will be removed with no bonuses or extras, why should bank execs be treated differently - oh cause they gave 20 years service , which produced bankruptcy and a horrific burden to the state

What exactly is your problem? The guy contributed to a pension fund presumably throughout his tenure with the bank, as was his entitlement. It's managed by an entity entirely external to AIB and it's starting to pay dividends. So what if the bank collapses? There's no suggestion of fraud in this instance, and the man should be allowed to manage his personal finances unmolested.

ascanbe

TelePaul wrote: »

You're right - damn the banks for giving us what we asked for! How dare they!

The fact that there were people willing to take out these loans doesn't absolve those who were dumb enough to give them out.
Those in management were being paid huge wages for their suppossed 'expertise'; their job in lending was to lend sensibly to people who had a legitimate chance of paying this money back.
They were the ones in charge of institutions that are now bust and being bailed out by the taxpayer.
So yeah... damn them.

Fluorescence

TelePaul wrote: »

You're right - damn the banks for giving us what we asked for! How dare they!

All I'm saying is that blaming the borrowers is the typical backlash to people who blame the banks.

Look at it this way: People who run banks and who work in the higher tiers of banking know about finance and economics (at least you'd hope so!). People who are looking for their first loan don't necessarily know the specifics of a borrowing culture. They just want the cash injection to get their lives kick-started. The lenders should have been more careful - deciding if the purpose the money would be put to was worth possible risks, and if the borrower was in a reasonable position to pay back their loans. They should not have been sending out leaflets advertising 100% mortgages to anyone who cared to walk into a bank and fill out a form. That's just not a sensible way to run affairs.

So yes, while people shouldn't have been biting off more than they can chew debt-wise, the banks should have been wiser in how they managed their money. If no-one supplied such unreasonable loans, no-one could have taken them out.

Just my 2c

Edit: ascanbe got there before me - and more concisely too! :P

bobblepuzzle

fluorescence wrote: »

All I'm saying is that blaming the borrowers is the typical backlash to people who blame the banks.

Look at it this way: People who run banks and who work in the higher tiers of banking know about finance and economics (at least you'd hope so!). People who are looking for their first loan don't necessarily know the specifics of a borrowing culture. They just want the cash injection to get their lives kick-started. The lenders should have been more careful - deciding if the purpose the money would be put to was worth possible risks, and if the borrower was in a reasonable position to pay back their loans. They should not have been sending out leaflets advertising 100% mortgages to anyone who cared to walk into a bank and fill out a form. That's just not a sensible way to run affairs.

So yes, while people shouldn't have been biting off more than they can chew debt-wise, the banks should have been wiser in how they managed their money. If no-one supplied such unreasonable loans, no-one could have taken them out.

Just my 2c

Let me put it to you this way...

Bank Manager:
You earn €40,000 p/a between you
Couple: Yes we do
Bank Manager: I am going to offer you €400,000 for your house

Now, forgive me if I'm wrong... but the couple cannot afford it if they get into difficulty... did they not think they may be turfed out if they don't keep up the payments?

The borrowers are just as much to blame as the lenders as far as I can see

TelePaul

ascanbe wrote: »

The fact that there were people willing to take out these loans doesn't absolve those who were dumb enough to give them out.
Those in management were being paid huge wages for their suppossed 'expertise'; their job in lending was to lend sensibly to people who had a legitimate chance of paying this money back.
They were the ones in charge of institutions that are now bust and being bailed out by the taxpayer.
So yeah... damn them.

I think this is an entirely Irish mentality, and this logic could be applied to a limitless number of scenarios: You sell me a gun, I shoot myself, who is responsible? We've become a society obsessed with blame and buck-passing. Yes, Capital Adequacy levels were ignored, and yes, unsecured credit should not have been extended in a great many cases - but if you can't make good on your repayments, you really shouldn't borrow so heavily in the first place.

th3 s1aught3r

I wouldnt have put too much faith in the bankers
Traditionally in Ireland, the bank was where someone got a job if they werent clever enough to go into a profession

TelePaul

Cmdr Keen wrote: »

Let me put it to you this way...

Bank Manager:
You earn €40,000 p/a between you
Couple: Yes we do
Bank Manager: I am going to offer you €400,000 for your house

Now, forgive me if I'm wrong... but the couple cannot afford it if they get into difficulty... did they not think they may be turfed out if they don't keep up the payments?

The borrowers are just as much to blame as the lenders as far as I can see

+1. No idea why people believe the entire risk should be assumed by the lender.

Fluorescence

I know that. Everyone's happy to blame the banks/government/anyone-but-me, sure they're the root of all our problems and we can't blame anything on ourselves :rolleyes:

What I'm saying is why didn't the lender look at the couples finances in your hypothetical situation and reconsider? Because the bankers got greedy and tried to milk as much money from the Celtic Tiger and ignored the economists who cried out about its non-sustainability. Ffs they saw it coming and looked the other way.

TelePaul

fluorescence wrote: »

What I'm saying is why didn't the lender look at the couples finances in your hypothetical situation and reconsider? Because the bankers got greedy and tried to milk as much money from the Celtic Tiger and ignored the economists who cried out about its non-sustainability. Ffs they saw it coming and looked the other way.

Are you inferring that this whole crisis was somehow instigated willingly by the country's financial institutions? If so, I think this is just another example of the hyperbole that's taken over, the tabloid mentality that's spawned such intelligent headlines as 'Wanker Bankers'. How many homes do you suppose Irish banks have re-possessed? Google it. Believe me, the borrowers have gotten off lightly in a great many cases, all things considered.

Fluorescence

TelePaul wrote: »

Are you inferring that this whole crisis was somehow instigated willingly by the country's financial institutions? If so, I think this is just another example of the hyperbole that's taken over, the tabloid mentality that's spawned such intelligent headlines as 'Wanker Bankers'. How many homes do you suppose Irish banks have re-possessed? Google it. Believe me, the borrowers have gotten off lightly in a great many cases, all things considered.

Not willingly, no. However, whatever way you want to look at it, you have to concede the sheer stupidity of the lending institutions in Ireland in recent years. When all's said and done, it was they who decided to lend extortionate sums to people in an unsuitable position to repay it.

I accept that people should have had more sense when it came to taking out loans that they probably knew they'd struggle to repay, but nobody forced the lenders to give that money to them. The bankers had the final say.

ascanbe

TelePaul wrote: »

I think this is an entirely Irish mentality, and this logic could be applied to a limitless number of scenarios: You sell me a gun, I shoot myself, who is responsible? We've become a society obsessed with blame and buck-passing. Yes, Capital Adequacy levels were ignored, and yes, unsecured credit should not have been extended in a great many cases - but if you can't make good on your repayments, you really shouldn't borrow so heavily in the first place.

Your analogy makes no sense.
If someone buys a gun they engage in a business transaction with the seller and then, under license, are responsible for the gun and what they do with it; the seller simply has to ensure they are selling it to someone entitled to own a gun and then have no further responsibility/dealings with the buyer.
If the buyer then shoots himself, of course the seller has no responsibility and it doesn't effect the sellers business.
For your analogy to make sense, you would have to be talking about a gun-seller who was stupidly selling the majority of his guns on-credit to people at a high-risk of shooting themselves.
Of course, selling guns, unlike banking in this country is, as far as i know, actually well-regulated; so such a seller probably couldn't exist.
This lack of regulation is the governments fault.
Of course, people have to take responsibility for taking out these loans; but the 'experts' who gave the loans were the ones with the ultimate say/who were in control of the money.
And it is their institutions that are now being bailed out at huge cost.
You talk of a society obsessed with apportioning blame and 'buck-passing'; yet you seem entirely happy to see those who were in charge of the banks face no sanction/pass the buck and to place all the 'blame'/hardship on the borrowers.

thebaz

TelePaul wrote: »

What exactly is your problem? The guy contributed to a pension fund presumably throughout his tenure with the bank, as was his entitlement. It's managed by an entity entirely external to AIB and it's starting to pay dividends. So what if the bank collapses? There's no suggestion of fraud in this instance, and the man should be allowed to manage his personal finances unmolested.

my problem is that the man who oversaw the ruining of one of the largest banks in Ireland, is now getting a yearly pension of 450,000 euros a year - i think its sick - you seam to believe the AIB is performing well, why did the state have to buy it so and pump billions into it ?? - your understanding of what is happening in the real commercial world is laughable , you've obviously had no dealings with them , just text book reading

Fluorescence

thebaz wrote: »

my problem is that the man who oversaw the ruining of one of the largest banks in Ireland, is now getting a yearly pension of 450,000 euros a year - i think its sick - you seam to believe the AIB is performing well, why did the state have to buy it so and pump billions into it ?? - your understanding of what is happening in the real commercial world is laughable , you've obviously had no dealings with them , just text book reading

I can understand why you're frustrated - the irish taxpayer is pouring billions into keeping the banks afloat, and it appears that this money is going straight into the pockets of one who got us into this mess.

However, he signed the contract years ago, and unless he decides to renegotiate it there's not really anything illegal going on here. It's not fair, or just, but that's life.

TelePaul

thebaz wrote: »

my problem is that the man who oversaw the ruining of one of the largest banks in Ireland, is now getting a yearly pension of 450,000 euros a year - i think its sick - you seam to believe the AIB is performing well, why did the state have to buy it so and pump billions into it ?? - your understanding of what is happening in the real commercial world is laughable , you've obviously had no dealings with them , just text book reading

What you fail to grasp is that this scenario can in fact be rationalized through 'text book reading' and not by non-sensical 'grrr bankers, blood boiling' comments. You've made the same point again and again, despite numerous posters pointing out how non-sensical it is. I'm just perturbed by the fact that so many people seem to have adopted a similar approach.

Dravokivich

ascanbe wrote: »

This lack of regulation is the governments fault.
Of course, people have to take responsibility for taking out these loans; but the 'experts' who gave the loans were the ones with the ultimate say/who were in control of the money.
And it is their institutions that are now being bailed out at huge cost.
You talk of a society obsessed with apportioning blame and 'buck-passing'; yet you seem entirely happy to see those who were in charge of the banks face no sanction/pass the buck and to place all the 'blame'/hardship on the borrowers.

I still don't see is what bearing this has, on this guys wages / pension payouts...

thebaz wrote: »

my problem is that the man who oversaw the ruining of one of the largest banks in Ireland, is now getting a yearly pension of 450,000 euros a year - i think its sick - you seam to believe the AIB is performing well, why did the state have to buy it so and pump billions into it ?? - your understanding of what is happening in the real commercial world is laughable , you've obviously had no dealings with them , just text book reading

You make it sound like that was a focal point of his agenda...

Saadyst

Two things.

I think it's obvious what people are raging about is the fact that someone who ultimately did so spectacularly bad at their job, is getting paid so much.

That would generally be fine since it doesn't matter to joe taxpayer - except now it does. Sure, legally it's fine, but that doesn't mean it doesn't stink.


Secondly, I find it hilarious at all the attempts to say "it's the borrowers fault just as much" - if I was in charge of making money out a million quid through lending, and instead I lost it all giving it out to people that couldn't pay it back - who is to blame?

On the one hand you have people chancing their arm and that is the extent of their "fault" - limited to themselves... on the other you have people systematically handing out millions upon millions of euro with the weakest of credit and background checks, they themselves borrowing more and more to increase what they can lend.

Yeah, it's the blame is totally equal. :rolleyes:

thebaz

Dravokivich wrote: »

I still don't see is what bearing this has, on this guys wages / pension payouts...



You make it sound like that was a focal point of his agenda...

Running the bank and to make a profit was his his focal point - and in both matters he failed

thebaz

TelePaul wrote: »

What you fail to grasp is that this scenario can in fact be rationalized through 'text book reading' and not by non-sensical 'grrr bankers, blood boiling' comments. You've made the same point again and again, despite numerous posters pointing out how non-sensical it is. I'm just perturbed by the fact that so many people seem to have adopted a similar approach.

maybe its fact that most people live in the real world, where they try and utilise the bank to run a business, and get the economy up and running again , liquidity right now is required to do so - sensible lending does not mean another property bubble - you my friend sound like an economic student with no such experience - you do not need text books to rationalize losses of 40 billion - one word bad management - now back to your books , and the spin of those comfy AIB adds, at least someone is getting suckered

Dravokivich

thebaz wrote: »

Running the bank and to make a profit was his his focal point - and in both matters he failed

Business' fail and as I've said earlier, the banks that were bailed out should have been left to fail...

It's been speculated that these banks only received bail outs due to interests members of the Government and their associates had with those banks.

If you want to blame anyone... get at them...

And as I've also said before, just because you do a shít job, doesn't mean the company stop paying you what you are due by them...

thebaz wrote: »

maybe its fact that most people live in the real world, where they try and utilise the bank to run a business, and get the economy up and running again , liquidity right now is required to do so - sensible lending does not mean another property bubble - you my friend sound like an economic student with no such experience - you do not need text books to rationalize losses of 40 billion - one word bad management - now back to your books , and the spin of those comfy AIB adds, at least someone is getting suckered

The Economy should not be based on Banking and Lending... that's what our problem was in the first place... The only way to get an economy running is to build up a home grown secondary industry, which we are seriously lacking.

€40 Billion euro wasn't lost, it never existed in the first place.

And I still don't see what any of that has to do with this blokes pension...

Noreen1

Cmdr Keen wrote: »

Let me put it to you this way...

Bank Manager:
You earn €40,000 p/a between you
Couple: Yes we do
Bank Manager: I am going to offer you €400,000 for your house

Now, forgive me if I'm wrong... but the couple cannot afford it if they get into difficulty... did they not think they may be turfed out if they don't keep up the payments?

The borrowers are just as much to blame as the lenders as far as I can see

It is true, unfortunately, that some borrowers were reckless. Other borrowers found themselves facing financial ruin through circumstances which they could not reasonably have foreseen, given the unprecedented scale of the economic crash in this country.

However, it is also true that banks were marketing loans, with money they themselves had borrowed, during the so-called boom.........

It had gotten to the stage, before the bust, where I stopped reading the letters my bank sent out, once I ascertained that it was yet another offer of a loan that I had not requested, didn't need, and could not afford to pay back. So, yes, the banks were reckless IMO.

My point is - not every citizen of this state borrowed recklessly - or, indeed, at all!!
Yet, those of us who are innocent of any financial mismanagement still have to pay for the irresponsible lending practices of the banks, coupled with the failure of the Financial Regulator, and gross mismanagement of the Economy by our Government.

So, I am angry - very, very, angry - at the failure of so many institutions to exercise due care. I am angry at the unjust system where the innocent taxpayer pays the price for the mistakes of others, and I am angry that time and again, those who are (largely) responsible for creating this mess are being rewarded.:mad::mad:

I acknowledge that there are contractual obligations. Unfortunately, these contractual obligations contribute to the unjustness of the situation.:mad:

Noreen