Can the banks get the economy on its feet?

The government is really looking to banks now to help jump start the economy.  The financial institutions need to start lending again to help the government in this task.

In the coming week the government will announce the level of bonuses and the level of lending that banks are doing.

The government may back down on the opposition for big bonuses to bank chiefs if they start lending more money to small businesses.  The shareholders will be able to see exactly how bonuses are given out because they want to understand what their money is going to.

The Royal Bank of Scotland and Lloyds TSB which are both state owned, stated that they will pay out the least amount in bonuses following warnings by Prime Minister David Cameron.

With bosses sharing a bonus pot of £3.5 billion rather than £7 billion, the tax payers that bailed out RBS will not be pleased.  Stephen Hester, RBS chief will probably take a bonus of £2 million.  Banks were told to lend out £30 billion to UK’s small businesses which they failed to hit that number.

Banks really need to understand that lending money is very important to build the economy back up to where it was before.