AMSTERDAM (Reuters) - The Dutch Finance Ministry will seek to curtail bonuses among senior management at financial companies receiving government support, while ING ING.AS is asking some staff to give back their 2008 bonuses.
In a letter to parliament, 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,” Bos wrote in the letter.
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.
From Europe to the United States, bonus payments at firms that were bailed out by taxpayers have become a focus of anger during the economic slump.
Millions of people took to the streets in France last week to protest excessive rewards in times of financial meltdown, and a scandal also erupted around American International Group (AIG) (AIG.N) over bonuses to executives of a financial products unit.
A spokesman for ING said on Monday 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.
“We will then look back to 2009 and if we made a profit the bonuses will be paid in line with the new policy,” the ING spokesman said.
ING received a 10 billion euro ($13.69 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 euros.
The Dutch government has also provided a capital injection to insurer Aegon (AEGN.AS), and offers a loan guarantee scheme for banks. Fortis’ FOR.BR Dutch activities, including ABN AMRO, were nationalized in October.
Additional reporting by Harro Ten Wolde; Editing by Jon Loades-Carter and Simon Jessop