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RBS chief exec in line for £7.7m pay package

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by Kay Mitchell

The Royal Bank of Scotland (RBS) has today revealed its chief executive, Stephen Hester, will receive an extra shares bonus worth up to £4.5 million – taking his total pay package to £7.7 million for 2010.

The bank, which is 83% owned by the taxpayer, also unveiled bonus payments for several of its other executives.

Finance director, Bruce Van Saun, will be awarded a £1.4 million annual payout and a and potential £2.8 million long-term incentive payout.

The substantial payouts arise despite the bank making a loss of £1.1 billion for the 2010 year.

Commenting on the bonus payouts, a spokeswoman for RBS, had this to say: “These awards follow exhaustive consultation with our shareholders and we believe they appropriately balance demonstrating restraint while remaining fully supportive of our leadership through the RBS turnaround plan.”

The news comes just a day after it was revealed that Bob Diamond, chief executive of Barclays, will be awarded a bonus of £6.5 million for the 2010 year.

While the figure is lower than a reported bonus of £9 million, Mr Diamond, who was appointed chief executive earlier this year, is already paid a £250,000 annual salary.

These hefty bonuses continue anger the public after many argued that excessive bankers’ bonuses rewarded the risk-taking culture that led to the financial crisis.

Since the onset of the crisis, bonuses have been a major issue and the news of the handouts come just weeks after the Coalition Government finalised a deal with banks on lending targets and pay restraints.

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News posted: March 8, 2011

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