RBS bonus fury as bankers walk away with £576m in 'astonishing betrayal' to taxpayers
RBS reveals staff bonus pot despite slumping deeper into the red with £8.2bn losses
Royal Bank of Scotland has sparked fresh outrage for its "astonishing betrayal" to taxpayers after handing out £576 million in bonuses despite slumping deeper into the red with annual losses of £8.2 billion.
The bank saw losses widen from £5.2 billion in 2012 after setting aside £3.8 billion in provisions for customer mis-selling compensation. It also took a £4.8 billion hit after setting up an internal bad bank. The bank's bonus pool is down 15 per cent on 2012 when it handed out £679 million.
The latest results mark the sixth, and largest, consecutive loss for the lender since it was rescued by taxpayers at the height of the financial crisis in 2008 following an era of reckless expansion under Fred "the Shred" Goodwin.
Chief executive Ross McEwan said the losses were "sobering" and "huge" but defended the bank's bonus pool insisting that the lender must be "pragmatic" when it comes to pay in a bid to "keep people doing their jobs" in a highly competitive industry.
Trade union Unite said the bank's decision to pay out more than half a billion pounds represented an "astonishing betrayal" for taxpayers given the scale of the losses- RBS has lost more than £46 billion in six years.
Chris Leslie, Labour's shadow chief secretary to the Treasury, said: "Taxpayers will be incredulous that such large bonuses continue to be paid out at a time when huge losses are being made.
"George Osborne should also make clear now that he would reject any request from RBS later this year for approval to pay bonuses of more than 100 per cent of salary."
Deputy Prime Minister Nick Clegg warned the bank, which is 81 per cent owned by the UK taxpayer, should show restraint on pay and bonuses.
Speaking on ITV1's Daybreak, he said: "A loss-making bank that is basically on a life-support system because of the generosity of British taxpayers shouldn't be dishing out ever larger amounts of money in pay and bonuses.
"The overall amount has been coming down. It needs to continue to come down. They are entitled to pay their staff what they want when they are standing on their own two feet. At the moment they are not."
McEwan outlined a new plan to make the bank "smaller, simpler and smarter" that will see it shrink from seven divisions to three. RBS did not confirm how many jobs will go as a result of reducing operations.
The bank said its cost-to-income ratio currently stands at 73 per cent. RBS has set a target of 55 per cent by 2017, which "will mean cutting around £1 billion of operational spend on things that don't help our customers," the lender said in a statement.
RBS was recently hit by allegations that it deliberately drove small businesses "to the wall" in a bid to generate profits from fees and seize assets on the cheap.
The bank has appointed top law firm Clifford Chance to conduct an inquiry into the claims put forward by Government adviser Lawrence Tomlinson in a scathing report last year.
RBS shares fell as much as 9 per cent in early London trading, the biggest faller on the FTSE 100 this morning, which wiped off almost £2 billion of its stock market value.
Children's bookseller wins The Independent's new author search
Board creates magnetic field to achieve lift
- 5 Paralysed man Darek Fidyka walks again after treatment by British doctors on brink of 'cure'
Jack the Ripper: Scientist who claims to have identified notorious killer has 'made serious DNA error'
Oscar de la Renta dead: Legendary US fashion designer dies after long cancer battle aged 82
Oscar Pistorius: The brutal prison life that awaits disgraced athlete
Banksy arrest hoax: Internet duped by fake online report claiming artist's identity has been revealed
Super-sized ships arrive in Britain: How big can they get?
Cameron is warned 'no possibility' of UK reducing immigration and that bid to bring in quota on migrant workers would be illegal
Residents should throw a street party and mix with immigrant neighbours, councils told
Russell Brand threatened with arrest after filming outside Fox News headquarters
London bus driver 'kicks gay couple off for kissing'
Lord Freud: Tory welfare minister apologises after saying disabled people are 'not worth’ the minimum wage
Lord Freud hangs on as MPs of all parties 'call for his head' over disability comments
iJobs Money & Business
£23000 per annum + pension and 22 days holiday: Ashdown Group: An established ...
£27000 per annum + pension, 22 days holiday: Ashdown Group: An established ind...
£23000 - £26000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...
£25 - 30k: Guru Careers: A Corporate Actions Administrator / Operations Admini...