More than 100 Royal Bank of Scotland bankers will receive bonuses of more than £1m.
The news comes as RBS announced it will pay out just £1.3bn in bonuses this year – the lowest compensation ratio in the industry. The ratio is set at just 27 per cent, far below the 38 per cent revealed by Barclays last week. The 18,000 bankers in RBS’ investment banking wing will each receive an average bonus of £73,000 but the top men will cash in far more.
Boss Stephen Hester yesterday estimated RBS is hemorrhaging staff due to its weak bonus pot and placed the loss to the taxpayer owned bank at £1bn.
An astonishing 10,950 staff have voluntarily left the bank in the last year, many to take up lucrative posts at the bank’s rivals. Hester himself waived the £1.6m bonus he was due, saying he did not want to deflect attention away from the progress the institution is making.
However, chairman Philip Hampton said Hester would be rewarded at the market rate for meeting targets in the future.
Chairman Philip Hampton said: “I understand the anger around bankers’ pay and RBS is leading the way in addressing that. But we need to pay people appropriately in market terms. The people responsible for the situation we are in have left the business.”
Gordon Brown yesterday threw his support behind the bank. His spokesman said: “The approach RBS is taking is completely in line with what the government expects. The Prime Minister knows we must move away from the old cash bonus culture, and move to paying bonuses in deferred stock, with the option to claw them back.”
The bank announced it will pay £208m into the public coffers through Alistair Darling’s bonus tax.
All bonuses above £39,000 will be paid in deferred shares and no more than £2,000 can be collected in cash.