Under Pressure, Bank CEO Waives $1.5M Bonus
Royal Bank of Scotland's Stephen Hester caves amid controversy
By Mark Russell, Newser Staff
Posted Jan 30, 2012 3:41 AM CST
A bailout in 2008 left the British government owning 82% of the Royal Bank of Scotland.   (AP Photo/Sang Tan)

(Newser) – The chief of Britain's second-largest bank declined his $1.5 million bonus yesterday, hours after opposition lawmakers vowed to put it to a vote, reports the Scotsman. The bank's board argued that Royal Bank of Scotland CEO Stephen Hester's bonus was reasonable, especially since his base pay of $1.9 million is lower than that of most comparable CEOs. But many lawmakers rejected that logic, saying that since RBS was bailed out heavily in 2008 and is now mostly public-owned, it should focus on paying back British taxpayers.

Pressure increased on Hester over the weekend after it was revealed the the bank's chairman waved a $2.2 million signing bonus. "We need a government that will tax bankers’ bonuses and bring responsibility to the boardroom," said the leader of the Labour Party. There is, however, a silver lining for Hester: The bank has a two-tier bonus system, and while he turned down the short-term bonus, he stands to receive a long-term bonus that could be worth as much as $10 million.

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Showing 3 of 6 comments
OuttaHere
Jan 30, 2012 11:33 AM CST
The board will make sure he gets compensated by the back door.
ExceleRater
Jan 30, 2012 7:50 AM CST
I was a mid-level manager. When I exceeded my plan, I got very nice bonuses relative to my salary. When I missed meeting my objectives, I got nothing - zip, zero, nada. CEO's live by their own rules, and they all camp out on each other's boards making sure they all get rich regardless of performance. I am a capitalist, but that is not capitalism. It's legal theft, and it occurs at all kinds of corporations, not just banks.
Antagonist
Jan 30, 2012 6:24 AM CST
I agree 100% with Mr Joshua. These people are the worst, the get paid BIG $$$$ whether the do well or perform badly, Then they have their F'N GOLDEN PARACHUTES. What a joke. Then the banks raise our interest rates on our credit cards, they also make a hefty sum on the money we deposit in their banks, all the while charging us money to maintain the money we have deposited with them. What a Joke, this gut puts off his 1.5 Million bonus so he can get a $10 Million bonus later. Under pressure he does this. Right..................