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Have banks learned their lesson?
Apparently not. Banks in the UK and the US are preparing to give bonuses to their executives, in spite of the impact of the financial crisis on world economies.
September 15, 2009 12:38 by Dana El Baltaji
The return of the bonus culture to banks shows financial institutions have not learned their lesson yet, reported the BBC on Tuesday, citing a comments made by an executive at the Institute for Public Policy Research (IPPR).
“Alarm bells should be ringing with the early signs of a ‘back to business’ attitude in the City and little evidence that policymakers are taking measures to ensure the next economic recovery is better balanced than the last one,” said Tony Dolphin, senior economist at the IPPR.
His comments echo US President Barack Obama’s warnings of contentment on Wall Street in his speech on Monday.
Obama said: “Normalcy cannot lead to complacency. There are some in the financial industry who are misreading this moment.”
“Instead of learning the lessons of Lehman and the crisis from which we are still recovering, they are choosing to ignore them. . . . We will not go back to the days of reckless behavior and unchecked excess at the heart of this crisis.”
He also called upon Wall Street to cooperate with “the most ambitious overhaul of the financial system since the Great Depression.”
Earlier this week, UK Prime Minister Gordon Brown said in an interview with the BBC that he is “appalled” that City banks are considering distributing hefty bonuses.
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