Pressure on RBS to announce slashed Hester bonus

 
Stephen Hester Mr Hester was appointed in 2009

Government pressure is building on Royal Bank of Scotland's board to announce that chief executive Stephen Hester is to receive a significantly reduced bonus.

I am hearing that the Treasury will inform the company that it believes Mr Hester should receive less than half the bonus of just over £2m that he was awarded last year. So that would be a bonus of less than £1m.

However, when I spoke to a Treasury official he said it would be inappropriate to reveal the government's negotiating position.

The board of the bank, led by the chairman Sir Philip Hampton, are adamant that Mr Hester deserves a bonus, for the way he has significantly reduced the risks taken by the organisation and made it less vulnerable to external shocks (such as a potential meltdown of the eurozone).

RBS's remuneration committee is meeting tomorrow. I am told that the committee is yet to have received formal representations from the Treasury.

The issue of Mr Hester's bonus is bound to be raised with the prime minister tomorrow by the Labour leader, Ed Miliband.

 
Robert Peston Article written by Robert Peston Robert Peston Economics editor

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  • rate this
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    Comment number 164.

    The UK taxpayer bailed out RBS and currently own 84% share (managed by HM Treasury). Mr. Hesters salary is £1.2 million without bonuses! He and other bankers should have a pay cut.
    No one should get bonuses, till the debt is paid back, because through no fault of their own, the average british person is struggling, loosing their homes, can't afford university, heating, dentists,a night out !!

  • rate this
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    Comment number 163.

    Well they are all the same The board of these companies they have to pay over the odds for top staff to keep the boardroom pay high all round
    If they paid bouses to all staff in company for the company doing well they may even do better

  • rate this
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    Comment number 162.

    Blubbery,
    Avaaz means noise pollution in Hindi.

  • rate this
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    Comment number 161.

    Protesters from civic campaign group Avaaz are due to gather at the RBS headquarters in London to call for BONUSES TO BE DROPPED. Avaaz mobilizes instant campaigns to address crises happening anywhere on earth - to close the gap between the world we have & the world we need. Avaaz means "voice" in several European, Middle Eastern & Asian languages.

  • rate this
    0

    Comment number 160.

    Hester's bonus, I believe, would be in shares rather than cash, & deferred for 3 years. Miliband has already urged PM to scrap Mr Hester's bonus altogether; at first, this angered me, & then I thought: Well, isn't Hester paid to do a job - like the rest of us lucky enough to have income? I'm not getting a bonus; no one even said that I did a good job!

 

Comments 5 of 164

 

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