Lloyds Banking Group Chief Executive Antonio Horta-Osorio has waived his bonus for 2011 due to a two-month absence, the bank's performance and the tough economic circumstances faced by its customers.
The bonus could have been worth £2.4m for Horta-Osorio, who will get basic pay of £1.1m
He may also get £4.5m in a long-term plan due to be paid in 2014.
"My bonus entitlement should reflect the performance of the group but also the tough financial circumstances that many people are facing," he said Friday.
"I also acknowledge my leave of absence has had an impact both inside and outside the bank, including for shareholders."
Bankers' pay, especially bonuses, has been politically contentious since the government spent 66 billion pounds bailing out Lloyds and Royal Bank of Scotland in 2008.
Prime Minister David Cameron wants to curb executive pay by making shareholder votes on remuneration packages binding.
Horta-Osorio's move could put pressure on other European bank executives to waive their bonuses after a torrid year for shareholders and more job cuts. In Britain, an insurance mis-selling scandal affected millions of customers.
Lloyds' shares slumped 60 per cent last year, one of the worst-performing stocks in the FTSE 100.