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Bankers are set to pocket record bonuses this year - just ten months after leading the world economy to the brink of catastrophe.
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Bankers are set to pocket record bonuses this year - just ten months after leading the world economy to the brink of catastrophe.
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Re: Bailed-out bankers share in £7bn pay and bonus pool as Goldman Sachs posts massiv
Bailed-out bankers share in £7bn pay and bonus pool as Goldman Sachs posts massive profit
By Simon Duke
Last updated at 11:14 PM on 14th July 2009
Bankers are set to pocket record bonuses this year - just ten months after leading the world economy to the brink of catastrophe.
Goldman Sachs is on course to lavish an average of almost £500,000 on each its 5,500 London staff after unveiling bumper profits yesterday.
Barclays and JPMorgan are expected to follow its lead. All three banks benefited from state bailouts at the height of the crisis.
Bullish: Wall Street giant Goldman Sachs is acting as if the credit crunch never happened, critics say
Tens of thousands of City traders and powerbrokers will see their bonuses this year beat those handed out in the boom year of 2007.
The bonuses for the so-called Masters of the Universe are likely to enrage families who have seen their finances wrecked by the credit crunch. A million workers are expected to lose their jobs.
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Ministers will be embarrassed because they had pledged to stamp out the greed and recklessness that spawned the credit crisis.
Goldman Sachs yesterday announced a £7.1billion pay and bonus pool for the first six months of 2009 - a rise of 33 per cent.
Vince Cable, Lib Dem Treasury spokesman, said that the moves suggested that too many people in the banking sector appear to have learnt no lessons from the past
The firm's 29,400 global staff will pick up an average of £242,000 each for this period, which over the full year would double to £484,000.
The average payout in 2007 was £408,000. The 400 partners, who include UK boss Michael Sherwood, regularly pull in multi-million pound annual bonuses.
Dubbed Goldmine Sacks for the extravagance of its rewards, the bank has emerged from the financial crisis in better health than many of its rivals. However, it was deeply entwined in the credit bubble that burst with such extraordinary force two summers ago.
And it suffered the indignity of accepting a £6.2billion U.S. government loan last autumn, which it has since repaid.
Vince Cable, Lib-Dem Treasury spokesman, said: 'It really does seem to be a case of business as usual.
'If we are to have stability in the finance sector, we must see pay restraint in all banks, irrespective of which country they are based in.
'Executives at Goldman Sachs clearly have short memories.'
Nick Ainger, a Labour MP on the Treasury select committee, said: 'The culture that led to this crisis, which was driven by bonuses and by risk taking, just hasn't changed.'
Goldman Sachs saw its underlying profits climb 33 per cent to £2.1billion between April and June after earning record fees from helping companies raise cash.
Finance director David Viniar said last night: 'Goldman Sachs accrues compensation during the year based on results - it's a pay for performance culture.'
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