Banker’s pay – the maths just don’t add up

Banker Pay – the mathematical truth behind the ‘pay for performance’ rip-off In this excellent and amusing article by the folks at Ripped-Off Britons (from the Guardian) they explore the mathematics behind bankers pay and performance. In truth bankers pay themselves so well because they can. The arguments about talent are weak. Senior bankers spend …

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Another Insurance Rip-Off

The Insurance Industry has rightly come in for criticism of some of its practices. They are opaque in many areas and seem to take the opportunity to load up premiums when they can. The spread of quotes can be interesting. Ranging from neat and tight groupings (surely not a cartel!?) to a huge spread. Another …

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Welcome to Honestlybanking

Hello and welcome to Honestlybanking.  The aim of this site is to give you an honest view on what goes on in finance and the world of banking.  I’m an insider so am taking a big risk by exposing the trade secrets. I plan to go into some more depth on different area. I’m going …

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How much do bankers really get paid?

How much do bankers really earn? This is actually quite a difficult question to answer as it depends on what you mean. Those working in your local high street branch, actually earn quite a bit less than you think. They don’t get the huge salaries and bonuses that hit the headlines. However they are critical …

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Banks Swing against star traders

Balance swings against the star traders Star traders…..what a load of rubbish!  Luck, luck and luck are all that is needed.  For every star their are thousands who are not. Usually when traders jump ship they somehow ‘loose their touch’.  Truth is they had before….they didn’t want to be found out.  I know a very …

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Banker’s pay – the maths just don’t add upAnother Insurance Rip-OffWelcome to HonestlybankingHow much do bankers really get paid?Banks Swing against star traders

May 02

Do you believe in Bob Diamond’s next life?

Categories:

Banks, Financial Crime, General, Leadership & Management

Bob Diamond’s next life?
This is a fascinating article in the New York Times about Bob Diamond and what he is up to now. It purports to give us insights into the man and what he thinks.
Mr Diamond is many things and one of those is being master of spin. He states he lived modestly and that he wasn’t motivated by money. He sounds like a man who is smarting and is still in denial at being the architect of his own downfall. He was clearly a man out of touch with reality.
There are many stories we have heard about Bob Diamond. He was something of a legend. He is on the journey to rebuild a new life. He doesn’t appear to recognise the damage he has caused to the global financial system.
There is a telling phrase in the article in respect of Libor manipulation. Mr Diamond states that he:
‘Didn’t even know the mechanics of how Libor was set. If you asked me who at Barclays submitted the rate every day, I wouldn’t be able to tell you.’
Mr Diamond worked on a Bond desk for a number of years. He used to boast of his deep understanding of this world. Indeed Bonds do form a key part of the bedrock of the financial system. For a former Bond trader to claim he didn’t know how Libor was set is simply not credible. It’s like a doctor not know that a heart beats. Why Mr Diamond claims this we can only speculate. Clearly the journey to his next life will be long.

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Apr 20

Risk and Profit

Categories:

Banks

There is an old saying in economics that profit is just reward for risk taken. Bankers take few risks with their own money, but plenty of risks with other people’s. Yet they take the profit.

The worst that can happen to a banker is prison for a crime. This is rare in the UK but more common in the US and other jurisdictions. Probably the worst that can happen is they are fired. As we have seen even giving up a knighthood and a portion of your pension is hardly reparation for damage done.

Many people take far more risks than bankers and do not profit. Greed drives it. Bankers are well rewarded for little risk. Remember this when negotiating with them. It’s probably your risk and their profit that is at stake.

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