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Pressure grows over RBS chief bonus

The chief executive of the taxpayer-funded Royal Bank of Scotland (RBS) is facing mounting pressure to follow the bank's chairman and waive his bonus of almost £1 million.

Stephen Hester has been under fire since it was announced this week he stands to earn a shares bonus worth £963,000, and the pressure on him was ramped up with news of Sir Philip Hampton's decision to forego a £1.4 million payout.

Prime Minister David Cameron sidestepped calls to personally block Mr Hester's award, saying: "It is a matter for him."

Sir Philip, chairman of RBS since 2009, had been on course to claim 5.17 million shares in the financial institution in February, but it is thought he told the bank's remuneration committee it would "not be appropriate" for him to take the shares to which he is entitled.

He was given the scheme when he was appointed at the 83% state-owned bank as part of a three-year long-term incentive deal. An RBS spokesman said: "Sir Philip Hampton will not receive the 5.17 million shares he was awarded in 2009 when he joined RBS."

Mr Hester, however, has so far refused to succumb to calls from politicians, unions and the public to forgo his 3.6 million shares.

Speaking at Chequers, Mr Cameron said: "It's obviously his decision. My decision is to make sure the team at RBS get on with the job of turning the bank round and we made our views very clear on the bonus and that's why it was cut in half compared to last year."

He warned installing a new top team at the failed bank could be even "more expensive" than it is now. "I think we need to get the facts straight," he said. "The fact is Stephen Hester was brought in by the last government, a contract signed by the last government to turn round RBS."

Labour leader Ed Miliband led calls for the Prime Minister to take action, insisting he had "another chance" to change his mind at the RBS Annual General Meeting.

He said: "Freezing the pay of a nurse or hospital porter, while allowing a publicly owned bank to pay million-pound bonuses is the last nail in the coffin of this Prime Minister's claim that we're all in it together."


From Belfast Telegraph