Royal Bank of Scotland Group Plc said Chairman Philip Hampton won’t receive a bonus agreed when he joined in 2009 amid political furore over executive pay at Britain’s biggest state-owned lender.
Hampton had been due to receive 5.17 million shares, a spokesman for the bank said today by e-mail. That would have been worth about 1.4 million pounds ($2.2 million), according to Bloomberg calculations based on RBS’s closing price yesterday.
The British Broadcasting Corp. reported today that Hampton gave up the bonus, saying that he told the bank’s remuneration committee it would be inappropriate to receive the compensation. Chief Executive Officer Stephen Hester is set to be awarded 3.6 million shares, worth about 963,000 pounds, even after the Edinburgh-based bank said this month it plans to cut 4,800 jobs.
The government won’t vote against Hester’s bonus at the company’s annual general meeting in April, the BBC reported, citing Chancellor of the Exchequer George Osborne. Prime Minister David Cameron’s approval has sparked criticism from the opposition Labour Party, as well as coalition allies in the Liberal Democrats and members of his own Conservative Party.
Hester’s shares will be based on the closing price on Jan. 25 when the decision was taken, the bank said yesterday. The bonus is half of what it was last year, Cameron said today in an interview at Chequers, the prime minister’s country residence.
“We need this team to get on with the job of turning the bank round,” he said in a transcript of his comments received by e-mail. “That is the major concern, that’s what needs to happen and that’s what the team needs to get on and do.”
Britain has an 82 percent stake in RBS after bailing out the bank with 45.5 billion pounds of capital during the 2008 and 2009 banking crisis. In addition to the planned job cuts, RBS said this month it intends to sell or close its cash equities, mergers advisory, corporate broking and equity capital-markets operations. Its shares have fallen 35 percent in the past year.