Bank Bonus Payments Surpassed Profit

I was reading WSJ coverage this morning about nine banks, which had previously received taxpayer bailouts, that are now paying $33 billion in employee bonuses. The outrageous behavior continues, I thought, about to turn the page. But then I read a sentence that would have lit my hair on fire, had I any.

"Six of the nine banks paid out more money in bonuses than they received in profit."

The rationale: if we don't pay our top performers, they'll go to work for a competitor. To which I say, that sounds like a great way to ruin your competitors!

If the new business model is to pay more in bonuses than what you earn in profit, these "top performers" will quickly drag down any financial institution they land at. Can you imagine how much topper money they would lard in as the economy improves? Let 'em go, says I, and sink all your competitors from the weight of their bullion-lined pockets.

What do you think? Is profit overrated? What does shareholder value mean in the banking sector these days?