I think it's fair and square that companies should pay for what they think a candidate is worth.

Having said that, I think this kind of strategy works only for those higher level staff that are being recruited.

Entry-level staff, management trainees, and other junior ranks - I seriously doubt there will be any 'bidding' war. The banks have fixed salary scales for such lower or entry ranks, and a candidate just have to either take up the offer or leave it.