Below we present some observations on the compensation package of the CEO of bank that is about to be no more (in its existing pre-BearStearns'ed form), a bank which since 2008 had operated with an implicit governmental guarantee of €150 billion and which bank was the biggest recipient of the Fed's taxpayer-funded bailout generosity during the Great Financial Crisis, confirming once again that when it comes to putting US taxpayer capital at risk for total loss, the Fed is truly second to none, without much commentary. It has all been said already numerous times...
From Flanders Today
Governor Luc Coene was speaking only days after the NBB took over the oversight role previously held by the CBFA, days which have been marked by mounting disquiet at the way top bankers pay themselves and each other huge bonuses. The latest example: Dexia bank CEO Pierre Mariani, it was announced, would be receiving a bonus down from €800,000 to €600,000. Closer inspection revealed that Mariani (pictured) was now receiving a "function premium" to account for that missing €200,000. His whole package came to €1.95 million - exactly the same as last year.
Dexia received €6.4 billion in fresh capital from the government in 2008, as well as a credit guarantee, to allow it to borrow money on the markets, worth €150 billion.
The main problem with the bonuses is that the banks in question were all to some extent bailed out by the federal and the Flemish governments in the financial crisis of 2009, and some of the aid still has to be repaid. In addition, trade unions noted that large bonuses for bankers come as a slap in the face to ordinary staff who are being asked to accept caps on pay rises as a result of the economic situation.
Last week Kris Peeters, minister- president of Flanders, whose government had stepped in to support Dexia and KBC, said that he intended to speak to the top executives of the banks personally. According to Coene, that is now his job.