RBS settles chief's bonus: not £1m – but not far off
The state-backed Royal Bank of Scotland (RBS) will hand its chief executive, Stephen Hester, an annual bonus of £963,000, it revealed last night.
RBS, which has been under huge pressure from the government to curb awards, said its decision was designed to “recognise tangible achievement in the business and protect the interest of our shareholders, including of course the UK taxpayer”.
It is handing Hester a bonus of 3.6m shares, or 60% of his maximum entitlement, on top of his £1.2m salary. The award is deferred so he will not receive it in full until late 2014.
He could have been entitled to £1.5m, but a public intervention by David Cameron has slashed the sum.
Liberal Democrat minister Jeremy Browne said last night that Mr Hester was 'a public servant' and should turn down the bonus.
Hester succeeded Sir Fred Goodwin as chief executive of the bank three years ago with a remit to sell off risky assets and make it profitable again. Sir Fred’s dangerous deal-doing precipitated RBS’s near-collapse and led to a £45 billion state bailout that left taxpayers’ holding an 83% stake in the lender.
Hester has made good progress in reducing the bank’s size but Britain’s weak economy and fallout from the eurozone crisis has sent its shares crashing by more than a third in a year. However, he became a figurehead in the government’s campaign against excessive boardroom pay.
The pressure for him to waive his bonus, as he did two years ago, increased when Antonio Horta-Osorio, the chief executive of Lloyds, another bailed-out bank, announced he wouldn’t take a bonus as he returned to work from two months of sick leave due to exhaustion.
”The board is aware of the difficulties in trying to reconcile the competing objectives of all our stakeholders,” RBS chairman Sir Philip Hampton said. “This is especially true on the issue of pay. Stephen Hester’s pay award reflects progress in the categories agreed with our shareholders as set out in the remuneration report. His pay is strongly geared to the recovery of RBS, which he was recruited to turn around, having played no part in its collapse. The priority is to re-shape a business that was far too big and far too risky, reducing legacy losses whilst improving performance in the group’s strong core businesses.”
- 1 Finland schools: Subjects scrapped and replaced with 'topics' as country reforms its education system
- 2 The West has it totally wrong on Lee Kuan Yew
- 3 #FreeTheNipple: Women in Iceland bare breasts in solidarity with trolled student
- 4 Scientists have discovered a simple way to cook rice that dramatically cuts the calories
- 5 Zayn Malik quits One Direction: Hundreds of workers request compassionate leave following band member's exit
Germanwings captain Patrick Sondenheimer tried to break into locked cockpit door 'with an axe' as plane was descending
Amanda Knox murder conviction: Italian court overturns verdict for US student and Raffaele Sollecito in the killing of Meredith Kercher
Saudi Arabia says it won't rule out building nuclear weapons
The battle for the Middle East's future begins in Yemen as Saudi Arabia jumps into the abyss
#FreeTheNipple: Women in Iceland bare breasts in solidarity with trolled student
Nigel Farage brands LGBT activists 'filth' and 'scum' and accuses them of scaring away his children after they invade his local pub
Ukip supporters are 55 or older, white and socially conservative, finds British Social Attitudes Report
JK Rowling responds to fan tweeting she 'can't see' Dumbledore being gay
Russia threatens Denmark with nuclear weapons if it tries to join Nato defence shield
Jeremy Clarkson sacked live: Alan Yentob 'wouldn't rule out' ex Top Gear host's BBC return
Germanwings plane crash live: Co-pilot Andreas Lubitz wanted to 'do something people would remember him for'
£12000 - £24000 per annum: Recruitment Genius: A opportunity has arisen for a ...
£32000 - £38000 per annum: Ashdown Group: A successful accountancy practice in...
£18000 - £23000 per annum + Uncapped commission: SThree: Does earning a 6 figu...
£18000 - £25000 per annum: Recruitment Genius: This is an exciting opportunity...