Thursday, January 6, 2011
Bank Shareholders Cash Out
Everyone agrees that UK banks are under-capitalized. Banks could increase their capital by holding onto their profits and deferring dividend payments.
Did UK Banks do that? A stupid question of course; this is Britain in the early 21st century. It is an age where no one thinks about the long-term consequences of their actions.
Truth be told, I can understand why. The future belongs to the geriatrics. In 20 years time, Britain will be a miserable place. So it is better to cash out now while you still can.
Since the crisis begin, UK banks have paid out about £30 billion to their shareholders.