Banking: Bonuses

Lord Campbell-Savours Excerpts

Tuesday 11th January 2011 Lords Chamber

[Lord Sassoon]

I am grateful to my noble friend Lord Hodgson and agree with his analysis. We need a successful and vibrant banking system in this country. We need healthy banks across the system, but it is particularly important for the taxpayer that the health of RBS and Lloyds is restored so that they can get a decent return in due course from its interest in those banks.

[Lord Campbell-Savours]

Is it not fair to say that bonuses based on share options could be quite remunerative?

[Lord Sassoon]

Indeed, bonuses based on a number of forms can be remunerative. It is now a fundamental part of the package agreed by G20 Ministers, incorporated in the European capital requirements directive in force from 1 January in the UK, that a significant part of bonuses now has to be paid in a non-cash form and cannot be cashed in for a considerable period. Absolutely, that needs to be part of the structure.