Merkel Criticises Bonuses Paid By Struggling Banks

In an excerpt of an interview with Der Spiegel news magazine, Merkel expresses her discontent with banks.

German Chancellor Angela Merkel criticised banks that pay bonuses while relying on government support and said she wanted a Group of 20 meeting in London to tackle the issue.

In an excerpt of an interview with Der Spiegel news magazine, Merkel expresses her discontent with banks that plan to pay out millions of euros in bonuses to banking executives for 2008.

"It is incomprehensible that banks being supported by the state are at the same time, in many cases, paying out giant bonus amounts," Merkel said, adding that would be an issue at the G20 meeting in April.

"In general, the bonus system has to be connected more clearly on an international basis to the longer-term success of the banks," Merkel said.

Resentment towards bankers has grown in Germany due to the global financial crisis, widely regarded as being caused by the excesses of those who profited from a free-wheeling financial system.

Last month, U.S. President Barack Obama said the multi-billion-dollar bonuses that Wall Street banks awarded themselves for 2008 were "outrageous".

The German government has agreed a package of reforms aimed at reining in executive pay. One amendment to Germany's Companies Act is that supervisory boards as a whole, rather than their sub-committees, would be held liable for "inappropriate" compensation packages awarded to managers.

The political will to take concrete steps has increased in the face of the financial crisis which has forced the government to push through a 500-billion-euro ($630-billion) rescue package for German banks.