Banksters show who is in charge £600m bonus pot despite RBS losses

Scandal-hit Royal Bank of Scotland has revealed bonuses of £607 million for staff in 2012 despite plunging deeper into the red with losses of £5.2 billion after a “chastening” year

RBS saw losses of more than five billion pounds

The losses widened from £1.2 billion in 2011 after its £390 million settlement for Libor rate fixing, while the bank revealed another £1.1 billion in provisions to cover mis-selling claims.

RBS set aside a multi-million pound bonus pool – including £215 million for investment bankers – but said it was recouping £302 million for its Libor settlement by cutting the 2012 bonus pot, clawing back from previous years and reducing current year awards.

Sir Philip Hampton, chairman of the part public-owned bank, told ITV’s Daybreak he did not know if taxpayers would ever get back the money used to rescue RBS. “We will do our best to see if the taxpayers’ money can be returned. but the bank was in a terrible mess, if you go back four or five years, it needed substantial re-capitalisation.

“Although we’ve had a difficult year I think we’re on track for recovery. It will be for the Government to decide when it sells its shares and how much they can get for them. Our job is to put the bank fully back on its feet.”

Asked why RBS can afford to pay bonuses to its staff but not what the public spent in bailing it out, Sir Philip described the bonus situation as “toxic for everybody”. He said: “The bonus rates have been falling very substantially. Our bonuses now in our markets business, where all the big bonuses are, are 25%, a quarter of what they were four or five years ago.”

He conceded bonuses were “still huge”, but said “it is a very difficult, competitive marketplace, and if you don’t pay what you need to pay you don’t get the best people”. Sir Philip said bonus levels were “tough to swallow” for the pubic, but that levels are falling “slowly but surely”. He said RBS was trying to rebuild customer service and confidence,but that it couldn’t be done over night.

RBS said it will look to increase its focus on the UK by floating part of its American bank Citizens in around two years. It was a move welcomed by Chancellor George Osborne.

He said: “The Government’s strategy is for RBS to be a stronger and safer bank, which in time can be returned to full private ownership. I have been very clear that I want to see RBS as a British-based bank, focused on serving British businesses and consumers, with a smaller international investment bank to support that activity rather than to rival it. I welcome RBS’s announcement today to accelerate that strategy.”

Chief executive Stephen Hester insisted this would be the last year under a “wrenching” restructuring and hopes the bank will be “clean” and ready next year for the Government to begin its return to the private sector. On an underlying basis, underlying group operating profits rose from £1.8 billion in 2011 to £3.5 billion in 2012, showing the core business is closer to returning to financial strength.

http://money.uk.msn.com/%c2%a3600m-bonus-pot-despite-rbs-losses

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