Banker bonus rules are getting watered down. Will anyone shed a tear?
When the European Banking Authority published its guidelines on executive pay in 2015, the report pronounced on 126 separate rules spread across 173 pages.
Any banker able to get through the whole rulebook without falling asleep surely deserved every penny of the eyewatering bonus they received – provided it met the guidelines.
The EBA’s voluminous report underscored the prevailing thesis that the largesse of bank remuneration committees played a big role in the excessive risk-taking that fueled the financial crash.
Whether this rulebook proved an effective antidote to those behaviours remains an open question. Some will say that it did its job – others that it made HR managers spend far more time figuring out whether their bonus policies were legally compliant, rather than whether they were any good.
Either way, few in the City will shed a tear at the news that, a decade on, the Bank of England is to water down its stringent bonus rules to give banks a little more flexibility on pay. I can already hear the pop of champagne corks from my desk on Cheapside.
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Is the Bitcoin treasury frenzy over?
The biggest sign yet that the popular Bitcoin treasury reserve strategy could be unravelling this week came from Japan.
A Tokyo-based company called Metaplanet, which had adopted the crypto-buying strategy, saw its own enterprise value slip below the total market value of its Bitcoin hoard, as was reported by Cointelegraph.
If that is not a warning for retail investors to think carefully before adding firms such as these to their portfolio, I don’t know what is.
That being said, London’s small-cap scene remains awash with Bitcoin treasury businesses, and more could yet be one the way.
A small asset management advisory firm called Falconedge is planning to list in London in November, seeking to raise £4m at a £10m valuation. The majority of the proceeds, the company says, “will be allocated to the accumulation of Bitcoin.”
To be fair to Falconedge, this isn’t just another firm trying to swoop in on the Bitcoin-buying mania: the company plans on advising other firms to get in on the act too. It says asset managers are likely to build bigger crypto allocations in the years ahead.
Others, on the other hand, could be on the way out. Auditors of Aquis-listed medical company Truspine Technologies, which adopted a Bitcoin treasury strategy in the summer, this week warned of “significant doubt of its ability to continue as a going concern.” Hmm.