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Reinfeldt calls for end to banks' bonus culture

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07:28 CEST+02:00
Swedish Prime Minister Fredrik Reinfeldt took aim at bonuses common at large banks when he opened the Swedish parliament on Tuesday, saying big bonuses "must come to an end".

His comments came 10 days before a meeting of the Group of 20 top developed and developing countries in Pittsburgh to discuss new ways to regulate the global financial system.

"The bonus culture that has emerged must come to an end. We have a unique opportunity to make progress on this issue when world leaders meet in Pittsburgh," Reinfeldt told the Swedish parliament, the Riksdag.

"More stringent rules are needed to restrict over-generous bonuses and compensation systems," he added.

The Swedish government said in March that it would ban all bonuses in all public companies and called on the private sector to follow its example.

On September 5th, G20 finance ministers agreed at a meeting in London that the bonus system should be transparent and should only reward long-term success.

They also said bonuses should be not handed out to bankers who performed badly and created losses.

France has been pressing for a cap on bonuses but that proposal has found little favour with Britain or the United States.

Reinfeldt, whose country currently holds the presidency of the European Union, said meanwhile there were "ever more signs now indicating that both the global and the Swedish economies are beginning to stabilize.

"We seem to have weathered the worst of the storms. The risks of a substantial economic downturn have abated," he said.

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