"We will hold ourselves accountable for what we do, and that starts with me."
-- Citigroup (C) CEO Vikram Pandit testifying before Congress on Wednesday. The heads of eight of the nation's top banks, which have collectively received $165 billion in government rescue funds, appeared together before the House Financial Services Committee to explain what they've done with the money so far.
The CEOs—including Goldman Sach's (GS) Lloyd Blankfein, Wells Fargo's (WFC) John Stumpf and J.P. Morgan Chase's (JPM) Jamie Dimon—got pounded on the bonus issue. Pandit, who collected a $1 million salary and no bonus last year, told lawmakers that he would earn just $1 a year and no bonus until his firm returned to profitability. Citigroup has lost more than $20 billion in the past five quarters.
Rep. Barney Frank, chairman of the committee, asked: "If you weren't getting a bonus, what would you not do? Would you take longer lunches or leave early on Wednesday? Why do you need to be bribed to have your interests aligned with the company?" The bank bosses insisted not. Morgan Stanley (MS) CEO John Mack replied, "We love what we do. If you gave us no bonus, we would still be here."
No doubt these guys were paid way too much for way too long, but would you take their jobs now, even for millions of dollars? Rep. Paul Kanjorski noted ominously in today's hearing: "When you took taxpayer money, you moved into a fishbowl. Now, everyone is rightly watching your every move from every side." --Jessica Shambora
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