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Myners and G7 in bank reform talks |
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Mon 25 Jan 2010
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LONDON (SHARECAST) - City Minister Lord Myners is meeting officials from the G7 nations at Downing Street today to discuss how best to prevent another bank bail out happening again.
Discussions with the world’s richest countries come as the banks pay out billions of pounds in pay and bonuses despite the financial crisis.
He wants the people who run the banks to foot the bill if they fail again and is said to be in favour of an insurance levy that would be used in the event of another bail-out.
The seminar at 11 Downing Street will also get the views of the International Monetary Fund, World Bank, Bank of England and Financial Services Authority.
They are likely to look at a possible global tax on bank transactions and consider the implications of making banks issue bonds which convert into bank equity should the worst happen.
Bonuses will certainly be on the agenda. Myners has noted the need to ‘re-examine an economic model that seems to work much better for investment banks than for businesses and workers’.
Goldman Sachs said last week it had allocated £10bn for bonuses, although today it said pay for its top 100 executives in London would be capped at £1m.
‘We’re not blind to the pain and suffering still going on around the world and we’re not deaf to the calls for restraint. We heard them,’ says Goldman Sachs’ finance director, David Viniar.
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