RBS bosses yesterday apologised for the Libor fixing scandal, saying sorry for failing to spot the crisis and for being too slow to rectify the problem once it had been identified.
Chief Stephen Hester told MPs and peers he is pushing through major changes at the bank, refocusing every business unit around customer service while restructuring the business.
But the chairman of the bank still had to defended the chief’s pay package against sceptical parliamentarians, arguing it is modest by industry standards.
Hester receives £1.2m in basic salary and £400,000 in pension contributions. He can also get twice his salary in bonus and 3.5 times in long term incentives, though he has not received a bonus since 2010 and has said he will not take it this year.
“I don’t think it is hyperbole to say this is one of the most difficult jobs in world business, it was the biggest banking failure in the world,” said Sir Philip Hampton.
“These are large sums, but well below the market rate.”
Meanwhile outgoing investment banking boss John Hourican said that many business leaders talk about accountability without taking any action on it.
“I am very sorry this happened on our watch. I accept responsibility for the failings,” Hourican said.
He hopes the departure of such a senior boss will shock any sceptics at the bank into changing their ways.
“I have told staff they should not waste my death – it is very important the company and everyone in it stands up and feels the anger around this issue, around the industry, around out company.”
WHAT THE BANKERS SAID
The most serious failings were fixed in a matter of weeks, but on different levels the improving of the Libor process is still going on to this day.
It just didn’t occur to anyone this was a rate that could be fiddled. It turned out there was a cartel of people across banks who thought they could fix it.
The bank was in too many places doing too many things with too little capital. I would accuse its predecessor organisations of strategic tourism.