RBS executives set for record £4bn bonus bonanza

By Jane Merrick, Political Editor

Sunday, 18 October 2009

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Bonuses and salaries totalling nearly £4bn are to be handed out to employees of the state-owned Royal Bank of Scotland (RBS) this year, it emerged last night.

The average worker in RBS's investment banking arm is on course to take home an average of £240,000, with the top 20 set to receive bonuses of between £1m-£5m.

The lavish awards for 2009 outstrip even those given in 2007 before the recession, and make a mockery of ministers' promises to clamp down on bankers' bonuses.

Last night, Gordon Brown, in his regular Downing Street broadcast, reiterated his call for banks to show restraint. He called for an end to "reckless banking practices" that contributed to global financial collapse last year.

The move means RBS is likely to clash with UK Financial Investments which oversees state-owned investments in banks. The taxpayer has a 70 per cent stake in RBS after the £20bn rescue of the bank, headed at the time by Sir Fred Goodwin.

Mr Brown said in his "fireside chat" podcast: "Banks must put lending to businesses and homeowners before making huge payouts to their staff." Mr Brown also promised homeowners better protection from lenders ahead of the publication tomorrow of a major report into mortgages by the Financial Services Authority.

The report is expected to recommend that borrowers will no longer be able to self-certify their incomes. Self-certification mortgages were originally intended for the self-employed, but led to "bad loans" at major banks.

All lenders will be required to verify incomes. The new regulations will be subject to consultation, but sources said Mr Brown expected lenders to implement them immediately.

Comments

( Leave a comment )

dnmurphy wrote:

Saturday, 17 October 2009 at 11:37 pm (UTC)

"Never again should banks and credit-card companies encourage you to borrow more than you can realistically afford to repay.""

Umm, why cannot people use their own brains and say no? Yes the bankers are stupid, but then so are the people who take out these loans.

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vhawk1951 wrote:

Sunday, 18 October 2009 at 12:02 pm (UTC)

because water runs down hill. so long as we have a culture based on that principle we will be degenerate as a people; every thing done the easy way, like water running down hill is as endemic here as it is in degenerate america

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longon007 wrote:

Sunday, 18 October 2009 at 04:02 pm (UTC)

Also, another big problem with the greed shown by the bankers and those of both houses of Parliament is their almost non-existent grip on reality, the reality of millions out of work, house repossessions etc etc etc. Until their grasp of what is real and what is fiction improves, and until water runs up hill, nothing will change.

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vhawk1951 wrote:

Sunday, 18 October 2009 at 04:17 pm (UTC)

yes a marked absence of intelligent thought and honourable conduct , but these require courage and effort; the exact opposite of water running down hill

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(no subject) -

myyshop030303 - Sunday, 18 October 2009 at 12:12 am (UTC) Expand

RBS Bonuses

maureen25 wrote:

Sunday, 18 October 2009 at 03:00 am (UTC)

RBS may be rewarding their hierarchy with large bonuses, but I wonder if anyone realises how they treat their core and frontline staff. Frankly they are very poorly paid, expected to work lots of extra hours for nothing, as they are so short staffed and the bank have no money to pay them, apparently. People are slave driven and, frankly, bullied! They are being told they have to work like this because I quote 'they are lucky to have jobs'. Staff are stressed, getting ill and no doubt RBS will probably kill some of them off with stress related illnesses in their quest to raise the share price to 70p so Stephen Hester can have his �10 million package along with his cronies. Frankly, it's an utter disgrace and totally immoral. The banks are corrupt the lot of them! I wouldn't trust any of them as far as I could throw them! RBS are trying to get the bank back on it's feet on the backs' of the average employee, all of whom had nothing to do with it's demise and are now being made to suffer one way or another. You either lose your job or, if you remain, get treated like dirt!

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But I thought Brown said ...

deimosp wrote:

Sunday, 18 October 2009 at 08:16 am (UTC)

Tough talk has come out of No 10 since the banks threw the world into recession through irresponsible and incompetent behaviour. We have has ages of strong words from Brown but nothing seems to have actually happened. If he wants things to change he should learn that he has to actually do something not just talk. A word from him means nothing to everybody (except the few remaining loyal MPs).

If Brown wants to be PM maybe he should actually do something he talks about. Any of the things he talks about - I'm not fussy. I'm just getting tired about all this talk from him followed by no action. Does he have so little power remaining that all he can do is talk.

Action accomplishes things, talk is just spin.

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Re: But I thought Brown said ...

littleglimmer wrote:

Sunday, 18 October 2009 at 08:20 am (UTC)

You are right. Governments have little power; it was given away in the great gold rush for capitalisation of national assets and the unleashing of the financial dogs of war in the 80's.

But take heart - Osborne says we're all in it together. Isn't that comforting?

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But I thought Brown said ...

milesbatch wrote:

Sunday, 18 October 2009 at 08:53 am (UTC)

"But take heart - Osborne says we're all in it together. Isn't that comforting?"
No, it isn't comforting - the man is a nutter! Biting heads off bats and all that!I t's obvious that years of drink and drunk abuse have taken their toll. I'm surprised Cameron has Ozzy in his cabinet- I thought he was trying to leave his druggy past behind him!

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Investment banking just one big scam!

pharmac wrote:

Sunday, 18 October 2009 at 08:57 am (UTC)

Over the longer timespan investment banking has never made a profit. It relies on surfing a wave of bubbles in order to pocket excessive margins and their associated obscene bonuses. But sooner or later the tsunami comes along and wipes out all the profit - but by then the bankers are galloping off giggling over the hill with their ill-gotten bonuses. All bubbles burst; the bigger and more complex they are, the bigger the mess. Our "masters of the universe" [and Gordon Brown] thought they'd created the perfect bubble, based on complex derivatives; so big, so widespread and so interwoven that it couldn't collapse, it couldn't be unwound - at least not unless the whole world economy unravelled... the corollary is that if you create a big enough global bubble it will bring down the global economy.... the rest is history! Investment banking is a scam and should be cast adrift from retail banking. Nationalisation of UK retail banking will prove to be inevitable.

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Re: Investment banking just one big scam!

vhawk1951 wrote:

Sunday, 18 October 2009 at 12:10 pm (UTC)

perhaps we need our own version of the Glass Steagall Acts to keep merchant banking and high street banking strictly separate by law; it cannot be right to gamble with depositors money- ormaybe that's normal?

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So what's new.

rojaws wrote:

Sunday, 18 October 2009 at 09:33 am (UTC)

i'm in the wrong line of business!

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CREDIT CRUNCH ( tHe SeQuEl )

chipmem1 wrote:

Sunday, 18 October 2009 at 10:06 am (UTC)

Be AfRaiD, be very AfRaid, nothing's changed.

Next time it's Bankrupt Britain, put your saving abroad, get the forms, put it in
NZ or Aus.. (much better interest rates, boys and girls ).

I'm with the Nelson.

This country values all the wrong things, the useless, the pointless, it deserves to
sink in it.

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big game!

wetgash wrote:

Sunday, 18 October 2009 at 10:38 am (UTC)

this is a big game in which everyone looses except the banks and the government. they really are laughing at us.

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time for british Glass steagall Acts?

vhawk1951 wrote:

Sunday, 18 October 2009 at 11:57 am (UTC)

I wonder if, under the elastic band principle, now is the time to introduce UK style Glass Steagall Acts?

if we don't does it not mean that we have learned nothing from the recent debacle?- underlying causes do not just go away, methinks, but I'm no expert

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Glass Steagul.

chipmem1 wrote:

Sunday, 18 October 2009 at 01:25 pm (UTC)

Can't say I'm an expert either, but which direction would you force interest rates ?

Governments and banks have a vested interest in keeping rates low, it's only
international pressure that matters now,...............

Growth in world economy, leads to higher international rates, leads to a bloody
hard time for the Uk. You must look at today as rest-bite, thats all thats
happening in my view.

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