News - Lenders
Mortgage Solutions | 17 Feb 2012 | 08:32
The Royal Bank of Scotland (RBS) director responsible for remuneration has defended awarding chief executive Stephen Hester a bonus worth £963,000.
The boss of the 83% state-owned bank was forced to waive the bonus last month following a public outcry and pressure from politicians.
However, in an interview with the Financial Times, Penny Hughes, a non-executive director and chair of RBS's remuneration committee, said Hester deserved the bonus as he was responsible for the "world's biggest corporate turnround".
The bank made pre-tax profits of £2bn in the three months to 30 September, compared to a £1.6bn loss in the same period in 2010.
Hughes said: "It's very clear what the market rates for various different jobs are.
"We can't be in a position where we penalise people because RBS is, to an extent, supported by the taxpayer as a consequence of actions from prior management."
She added prevailing economic conditions should not affect the decision-making on bonuses and, although she will look again at the bank's pay structure, dismissed any radical reforms.
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Recent comments
Much as i expect the wrath, and have already had it from friends and family, but if I was hester i'd be raging. You would as well if you had fulfilled the necessary KPI measuring indicators as specified by your contract, thereby making your bonus all above board as you have done what the government had targeted you to do, to have it taken from you due to political and outside pressure from people ill equipped to make such judgements. lets not forget he is the governments firefighter, he was parachuted into NR first, then the governemtn asked him to sort out RBS. So waht if he has axed thousands of jobs, if they are axed and the bank is still making a profit without letting service slip, then hes doie well and those let go were obviously superflous anyway. He is fulfilling his part, he should be paid what he is due, lets not forget he could command a mugh higher salary package elsewhere. In our world, which is the same as his, target orientated, you make target, you get bonus. Simple. Oh and trotting out the picture of him hunting and bringing up his estate continously has nothign to do with his performance at RBS. I'm not even a big RBS/NW fan, but whats right is right.
john
17 Feb 2012 | 13:07
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