Insurance Companies Should Support Barclays Shareholders Bonus Demands

Regular readers of Insurance Blog will know that we are not fans of Banc-assurance, indeed if it was mandatory you’d find us voting for UKIP in next months local elections!

The whole concept of banc-assurance, a European import of the mid Nineteen Nineties, with it’s centralised lifestyle, bank and insurance personal umbrella,  has stunk of plutocracy since the cosy relationships were first formed to maximise profit for the few.

PPI claims and mis-selling are just one example of things that would never have occurred if Banks had not been allowed to sell insurance products. (or should I re-phrase that ‘mis-sell’).

Large un-democratic multi-nationals are not good for competition or the UK Economy and the evidence shows that they are stifling business growth. Critics may argue that the market will decide and shareholders make this process democratic.

Not when over 70% of the shares in the Banks are owned by the large Insurance Companies, including in particular the large life  insurance and pension fund composites of Aviva, Legal & General and RSA, to name just a few!

Don’t just blame the previous Labour Government (FSA) for the mess that was created outside of their control. The fact that as predicted here two years ago, the UK has this week slipped into the dreaded double-dip recession, shows the problem is fundamently structural and lies in the ownership, management and control of the banks and mortgage lenders who control the money supply and are responsible for the current Western recession.

Incidently, by restricting credit they are also currently responsible for killing British entreprenuerial spirit and destroying growth potential in SME business.

The poor management speaks for itself in shareholder dividends. Just a penny in the pound for those poor shareholders of Barclays!

Today they are openly up in revolt to demand that the Chief Executive is not worth his $4 million annual bonus. Quite rightly so in our humble opinion. The overpaid who fail should not be rewarded, especially at the expense of those who take the risks.

Barclays chief executive Bob Diamond received a £1.35m salary and a £2.7m bonus for 2011, with an additional £2.25m in long-term incentive payments. Barclays has set aside an extra £300m for settling claims of mis-selling payment protection insurance. A £2.62bn accounting adjustment and the extra Payment Protection Insurance Claims reserve meant the bank reported a statutory pre-tax loss of £475m in the first quarter of this year as opposed to a £1.66bn profit a year ago.

More importantly though, the actions of these minions will fail as the outrageous bonuses are supported by the Insurance companies, who own big blocks of shares and voting rights.

There is your Plutocracy!

Regardless of your political allegiances, before you renew your insurance, if you can afford to that is, think about how these multi-nationals are encouraging the sort of undemocratic behaviour seen today that should not be seen at all, especially in a time when millions of families in the UK, it has also been announced today, between them owe £58 billion in debt mostly composed of interest and bank charges, to these very same ‘institutions’.

 

Comments are closed.