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Booming bonuses back in EU bank chief's sights

15 March 2011, 22:22 CET
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(BRUSSELS) - Europe's financial services commissioner warned Tuesday he may "go further" in regulating bankers' bonuses, after saying an appeal for humility was ignored.

"The bonus season is coming to a close, I don't get the feeling that my appeal for moderation has been heard," France's Michel Barnier said after talks among European Union finance ministers that made little headway on proposed curbs on contentious short-selling and credit default swap markets.

"The crisis seems well behind a certain number of people with short memories, particularly in the banks," he added.

Multi-million-dollar bank bonuses became an early symbol of public anger when a financial crisis broke in 2008-9 as a pyramid of debt speculation, much of it on property, burst in the United States.

Figures such as the former head of bailed-out Royal Bank of Scotland, Fred Goodwin, saw his Edinburgh home attacked and his reputation pilloried as public and media pinned blame on the banking industry for the crisis.

Barnier has gone quiet in recent months after a high-profile start to the job last year, with suspicions rife in the City of London of French designs on the success of the Square Mile's finance industry.

But he vowed Tuesday to stay on the bankers' backs after bonuses already labelled "scandalous" by International Monetary Fund chief Dominique Strauss-Kahn.

"We are going to look very carefully at how the first rules for bonus awards in Europe have been implemented, and if they haven't been followed, propose going further," Barnier said.

He added he would also check whether G20 recommendations underpinning EU regulations had been followed, when he visits China later this week.

A banking source, though, said Barnier should not mix up all bank behaviour "with that of the British."


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