There used to be a time on Wall Street when bonuses were configured on a firm-wide basis. If the firm did well, bonuses were distributed to all. If not, the bonus well was dry. That simply made sense.

Now, there is a ‘1% Mentality’ where management, top traders and bankers often receive bonuses regardless of a firm’s bottom, and largely to the exclusion of other employees. Of course, so-called 'rainmakers' deserve, to some extent, outsized rewards when they were instrumental in helping their firms perform (exceptionally) well in a given year. Conversely, why should they not receive $0 bonuses when the firm performs below expectations, and even have some of their compensation clawed back when they personally incurred(say) trading losses or performed below pre-set standards?

Which brings us to ‘lowly’ Royal Bank of Scotland. Today we learn that the bank awarded shares worth almost £16 million (over $19Mn) to its top management team – including $7Mn in bonuses that were awarded in prior years.

Unfortunately, this comes after RBS reported losses for, yet, the 9th consecutive year. For 2016, RBS reported losses of £8 billion – which translates to nearly $10 billion. Over the 9 years, RBS recorded cumulative losses of £58bn - assuming a rate of £1 to $1.50, that amounts to $87 billion.

And it comes at a time when the U.K. government remains unable to unload its 73% stake in the bailed-out bank.

And the bonuses were paid because, in the words of RBS Chair, Sir Howard Davies, the staff should not be penalized for the “sins of the past.”

METHINKS THE BANK HAS THINGS UPSIDE DOWN.