GLOBAL SUB-PRIME CRISIS

BANKILEAKS

Click on our Secret Library of Evidence ------>

    BANKILEAKS Secret Library

Loan Application Forms (LAF's)  

    Bank Emails to Brokers  

    Then Click on 'VIEW NOTEBOOK'

Join us on facebook
 

facebook3           facebook2 

BFCSA
MORTGAGE
DISTRESS SOS

What BFCSA Does...

BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.

Visitors

Articles View Hits
591884

Whistleblowers' Corner!

To all mortgage brokers, BDMs and loan approval officers! 
Pls Call Denise: 0401 642 344 

"Confidentiality is assured."

Cartoon Corner

Lighten your load today and "Laugh all the way to the bank!"

Denise Brailey

Led by award-winning consumer advocate Denise Brailey, BFCSA (Inc) are a group of people who are concerned about the appalling growth of Loan Fraud around the world. BFCSA (Inc) is a not for profit organisation in the spirit of global community concern and justice.

Click on the Cluster Map.

  • Home
    Home This is where you can find all the blog posts throughout the site.
  • Categories
    Categories Displays a list of categories from this blog.
  • Bloggers
    Bloggers Search for your favorite blogger from this site.
  • Login
    Login Login form

BFCSA: Bankers fear more strikes in exec pay 'showdown'

Posted by on in ROYAL COMMISSION URGENT
  • Font size: Larger Smaller
  • Hits: 204
  • 0 Comments
  • Print

Bankers fear more strikes in exec pay 'showdown'

Sydney Morning Herald April 11, 2019 12.00am

Clancy Yeates and Mathew Dunckley

 

EXCLUSIVE  Banks face a fresh showdown with shareholders over executive pay and risk copping second "strikes," senior bankers warn, after the regulator urged boards to put less weight on financial targets when paying bonuses.

In an attempt to improve bank culture, the Australian Prudential Regulation Authority (APRA) is expected to propose restrictions on bank executive pay in the coming weeks. Chairman Wayne Byres last month signalled it would be calling on boards to give more consideration to non-financial factors such as customer outcomes when determining bonuses, as recommended by the royal commission.

But senior bankers have told the Sydney Morning Herald and Age such a change is likely to be resisted by key investors, some of whom have previously worried that non-financial targets can be more easily “gamed.” The bankers' warnings were played down by institutional investors and proxy advisers, who insisted they were not opposed to non-financial targets, provided these were transparent and justified.

The debate comes after National Australia Bank, Westpac, and ANZ Bank received first "strikes" of more than 25 per cent against their remuneration reports last year. Another strike this year at any of these banks would trigger a vote on whether to spill the board.

"It is very difficult. We are heading for a bit of a showdown,” said one senior banking source. The source said satisfying APRA and shareholders was a difficult task because “you are never going to get everyone to agree”.

The senior banker said there was a risk in regulators effectively making decisions on behalf of companies. “APRA is entitled to their opinion but — unless there is regulation — it is a matter for the shareholders,” they said.

Another senior source said they understood where the regulator was coming from, as an investor "obsession" with linking pay to total shareholder returns was "dangerous" because of the behaviour it could lead to inside banks. But they raised concerns some of the biggest investors in major banks were unlikely to support the regulator's proposal to put more emphasis on non-financial targets.

"It's going to take a lot of effort to find a solution that will meet APRA's requirements and avoid a second strike," they said. "Three banks could face a second strike," they said.

Each of the banks is likely to hold detailed meetings with shareholders over the coming months, in an attempt to find common ground. Commonwealth Bank avoided a strike last year after slashing executives' bonuses.

The looming debate comes as investors are also calling on bank boards to exercise more discretion in paying out multimillion-dollar bonuses to senior bankers.

PwC remuneration specialist Emma Grogan said investors were unhappy there had been "insignificant consequence in situations were the banks were suffering severe reputational damage". She said bank boards were in "difficult position" because of the wide divergence in views on executive pay.

"Across the different stakeholder groups there are hugely divergent views between regulators, proxy advisors, investors... it is a very difficult time to arrive at a consistent forward for all of those stakeholders," she said.

Ms Grogan said any new APRA standards could well not be in place before the next round of bank shareholder meetings meaning the companies could have time to mollify investors before having to meet new regulatory requirements.

Governance expert Dean Paatsch, of Ownership Matters, said APRA's perspective on bank executive pay was "breathtakingly naive," but it was "completely unrelated" to the risk of banks incurring more "strikes" later this year.

The main point of controversy in Mr Byres' comments was his assumption that a greater emphasis on non-financial targets would solve the problem, he said.

Head of investment stewardship at Vanguard, Glenn Booraem, said the fund would consider APRA's proposal. It thought "performance-linked remuneration policies" were "fundamental" drivers of value, but the more important debate was to support long-term remuneration structures over short-term targets, he said.

The executive manager of governance and engagement at the Australian Council of Superannuation Investors, Ed John, said non-financial measures were already in the remuneration mix, but they had not always had the intended effect on culture. 

Last modified on
Rate this blog entry:
0

Comments