Blankfein criticizes excessive bonuses

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Bill Radke: The head of Goldman Sachs is causing a buzz this morning. At a banking conference in Frankfurt, Lloyd Blankfein attacked what he called excessive bonuses. He said the public has reason to be angry about bankers’ pay. From the Europe Desk in London, Stephen Beard reports.

Stephen Beard: Blankfein startled his audience, saying that the furore over bank bonuses was both understandable and appropriate. He called for guaranteed bonuses to be banned, and he condemned what he called “outsized compensation” when a bank is losing money.

Andrew Hilton runs the Center for the Study of Financial Innovation. He says this is all a bit rich coming from the head of Goldman Sachs:

Andrew Hilton: Blankfein took out $176 million in pay and compensation over the last five years. I suppose that he could forego his bonus for at least a couple of years and still manage to support the house in the Hamptons and the yacht in the Bahamas.

In his speech, Blankfein also admitted that banks had lost control of the exotic products they were selling before the crisis. Observers say he was striking a note of contrition before his Frankfurt audience. German banks have lost heavily on asset-backed securities.

In London, this is Stephen Beard for Marketplace.