Britain and Germany called on the Group of 20 leading nations to act on bankers' bonuses when they meet later this month in the United States, according to dpa. "We must curb the bonus culture in the financial sector," British Prime Minister Gordon Brown said at a joint press conference with German Chancellor Angela Merkel in Berlin. He said the message of the last 12 months was that "the world can and did come together to prevent economic collapse and to prevent would could have been a second Great Depression." "We now need to come together again with heightened cooperation to ensure that the recovery, which is fragile and not automatic, is not put at risk," Brown said. Germany and France have already emerged from the recession triggered by last year's global financial crisis, and Britain is expected to do so next year. Merkel said she wanted leaders at the Pittsburgh, Pennsylvania, meeting to agree on measures that would limit the high bonuses paid to bank executives, seen by many as a cause of risk-taking that has been blamed for the crisis. She said a system in which bonuses are paid out over a longer period based on the sustainability of a bank's performance would be preferable to present bonus practises. Another measure to reduce risk-taking would be for bank's to increase the percentage of their capital in relation to their risk- weighted assets, she said. Both Merkel and Brown said they were in agreement on the approach they will take at the September 24-25 Pittsburgh meeting, following Saturday's preparatory conference of G20 finance ministers in London. The ministers agreed on steps to limit bankers' bonuses but declined to back French and German proposals for a mandatory cap. Instead, they proposed that bonus payments should be deferred for up to five years to allow time to assess bankers' actions over the longer term. Analysts said that represented something of a victory for Britain and the US, which had been wary about restrictions that might threaten their financial centres in the City of London and Wall Street respectively. Last month, French President Nicolas Sarkozy announced plans to curb bonuses paid to French bankers by staggering them over a period of three years, converting at least one-third of bonuses into shares and making them subject to performance criteria. Similar proposals have been drawn up in Germany, where Merkel wants bonuses to be withheld for four years. The Pittsburgh summit will be the third time that the G20 leaders have met since the implosion of the US investment bank Lehman Brothers 12 months ago sent shock waves through the world economy. Since the G20 leaders last met in April, signs have mounted that the world economy is starting to pull out of what has been the deepest recession in six decades.
