HSBC chief calls for tighter bonus regulation

2 November 2011

Banks should have their powers to hand out dividends and bonuses restricted if they are in serious financial problems.

That is according to Stuart Gulliver, chief executive of HSBC, who believes regulatory bodies should be handed more control over how financiers handle reward payments in times of fiscal difficulty, the Financial Times reports.

During a session with the parliamentary committee tasked with analysing the draft financial services bill, Mr Gulliver stated that the Bank of England (BoE) should definitely have greater levels of control in extreme circumstances.

The HSBC official - who appeared at the meeting with his counterparts from Barclays and the Royal Bank of Scotland - explained this would be "absolutely reasonable" in order to avoid any repeat of when taxpayer money was needed to bailout lenders.

This comes after Robert Jenkins, member of the BoE's interim Financial Policy Committee, urged companies to be more proactive to make sure their shareholders are not exposed to harm through targeting return on equity.

By Claire Archer

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