Banker windfalls spark fresh anger
Fresh anger about bankers' pay has erupted after it emerged that Barclays boss Bob Diamond made £6.3 million in 2011 and the chiefs of two taxpayer-backed banks are set for additional multimillion-pound windfalls.
Just weeks after the furore over his £1 million bonus award, Royal Bank of Scotland revealed that Stephen Hester is set to receive shares from a long-term incentive scheme currently worth £1.6 million.
At fellow taxpayer-backed Lloyds, Antonio Horta-Osorio is set to be awarded 9.6 million shares, worth £3.3 million, which will also mature in three years, despite him turning down his bonus after taking sick leave.
The disclosures from three of the UK's biggest banking groups left City investors deluged with information on pay and bonuses during the course of Friday afternoon. In the case of RBS, its annual report was released at 4pm.
The releases fuelled fresh anger that bankers are escaping the worst of the economic storm which is eroding the standard of living of ordinary families. TUC general secretary Brendan Barber said Mr Diamond's award "epitomises how banks have failed the wider economy and got away with it".
Mr Diamond is set to receive shares worth some £4.9 million in three years on top of his £1.35 million salary despite a fall in the bank's profits and it being among the banks hit by payment protection insurance mis-selling claims. He also pocketed £15.1 million last year as previous employee benefit schemes bore fruit, while Barclays also footed a £5.7 million tax bill racked up when he left the US to take the top job in the UK.
But he was not the highest paid member of staff at the bank for 2011. Two other unnamed executives, thought likely to be Rich Ricci and Jerry del Missier, who jointly run its investment banking divisions, received total pay-outs of £6.7 million and £6.5 million. The bank, which has already come under fire for not reducing bonus payments enough, has revealed that the average bonus for employees at Barclays Capital fell 30% to £64,000, following a 32% fall in profits at the arm.
At RBS, Mr Hester's long-term incentive plan could be worth as much as £3.6 million, although the bank's calculations assume he is more likely to collect less than half of the maximum available. John Hourican, RBS's investment banking head, is set to receive shares currently worth £4.2 million next month when a previous long-term incentive plan matures, while he also received a shares bonus of some of £2.5 million for 2011. The highest paid RBS banker for 2011 was US boss Ellen Alemany, who received a total package of £4.7 million.
RBS chairman Philip Hampton said: "Running RBS on commercial grounds is the only way to make the bank safer and more valuable for everyone who depends upon it. An inescapable part of commercial success is making sure that we attract, and keep, good, well-motivated people."
Meanwhile, Lloyds, which does not have a large investment banking arm like most of its rivals, revealed that its highest paid member of staff, who was not named, pocketed £2.8 million for 2011, while the biggest bonus award was 2.4 million shares, worth some £800,000.