THE DUTCH finance ministry will seek to curtail bonuses among senior management at financial companies receiving government support, while financial services company ING is asking some staff to give back their 2008 bonuses.
In a letter to parliament, minister for finance Wouter Bos outlined stricter measures to regulate bonus policies at firms receiving government support, noting persistent social discontent regarding the bonus culture of the financial sector.
“A cultural change needs to take place with regards to remuneration policy, particularly in financial institutions receiving support from the government or who were taken over by the government.”
He said measures to regulate the bonuses of executive board members in firms receiving financial support should also apply to senior management, and he would aim to prevent bonuses being paid to managers in 2009.
He said he would keep the option of going to court open if necessary, and said he would urge the Dutch Central Bank and market regulator AFM to urgently pay attention to payments at financial institutions in their role as supervisors.
Bonuses for bankers became an issue in the Netherlands after ING said it would give its incoming chief financial officer, Irishman Patrick Flynn, a signing-on bonus of 100,000 shares, which could be worth up to €1.3 million.
Mr Flynn, currently chief financial officer of HSBC’s global insurance business, based in London, is a graduate of Trinity College, Dublin, and trained as an accountant with KPMG.
ING received a €10 billion capital injection from the Dutch state in October last year and executive board bonuses for 2008 were scrapped.
However, it has faced criticism for bonus payments to staff in 2008, which amount to about €300 million.
A spokesman for ING said yesterday it had launched a "moral appeal to management to hand in bonuses for 2008", confirming an earlier report in Dutch daily De Volkskrant that ING was asking 1,200 employees to return their bonus payments.
The company has also deferred bonuses for 2009 until a new remuneration policy is set, which is due in 2010. – (Reuters)
