RBS chief to get £900,000 bonus

Rinoa

Just in.

BBC says Hampton has given up the £1.4m shares reward he was due to get.

http://www.bbc.co.uk/news/uk-politics-16772525

HAMISH_MCTAVISH

Graham_Devon wrote: »

Joe Public ARE angry. They can't quite understand 3 things.

Given that the average IQ is only 100, I'd suggest there are far more than just 3 things Joe Public can't quite understand....

But anyway.

1) Why a bonus has now become a "right" as part of the pay year after year, absolutely regardless of how profitable or non profitable the business is

Nonsense.

There will be specific performance measuring targets he has to hit for the different components of a bonus. It's how most large companies work, and how most senior managers are rewarded.

In the case of Hester, I'd be surprised if that didn't include significant rewards for shrinking the balance sheet and restructuring/downsizing the bank's operations, as well as just profit/share price.

If he hits none of his targets, he gets no bonus. He clearly has hit some, but not all, of his targets, and so will get some, but not all, of his bonus.

2) Why he, like all of us, is paid to carry out a job. In his case, he is paid on average £23,000 per week, yet this is simply pushed to the side, and he appears to get a bonus, which equates to around £20,000 per week, JUST for carrying out the job he is paid £23,000 a week to do.

You don't see brain surgeons expecting a bonus for every patient they save. You don't see MP's expecting a bonus for every decision they make, or being asked to speak. But you DO see bankers seemngly expecting a bonus SIMPLY for carrying out what they are paid hansomly to do.

It just doesn't work like that Graham.

The going rate for a bank CEO, as I've posted earlier, is many millions of pounds a year. Now if you're going to pay anyone millions of pounds a year, you'll want to make sure that there are performance related targets for them to hit, and that part of their pay is linked to hitting those targets.

It's that simple.

It's the disconnect between not only the ordinary folk earning what Hester earns in one single day in a whole year....but the disconnect even with what we would class as highly paid individuals.

Top bankers are on a whole new level of numeration, expectations and outright greed and contempt. Someone on the BBC comments section worked out that even if you worked at 35k each year for 45 years, you STILL wouldn't earn as much as Hester has in ONE single year. Hence the disconnect is simply massive. Somewhat distasteful in some ways, especially in light of the current conditions of the bank and the economy and whats expected from everyone else.

And that little rant just veered right into the politics of envy.

3) This bank caused massive financial losses for ordinary folk up and down the country.

Not under Hester.

this bloke makes some decisions, gets paid to make them and then EXPECTS a bonus.

If only it was that easy Graham......

There's an awful lot of bravado going on from some armchair CEO's in this thread, but the fact remains that only a dozen or so out of the 60 million people in the UK are qualified to run a bank of that size, and most of them would cost the taxpayer a whole lot more than we pay Hester.

It is patently absurd to suggest that performance related pay is a bad thing. In fact, I would like to see more people paid based on performance, not less.

What is clear however is that the average member of public, like you Graham, has absolutely no idea how it works.

So get rid of the word "bonus" entirely, and describe it in terms of "penalties" instead.

In the case of a bank CEO, that could look something like the following:

Total salary eligibility if you hit all your targets = £3,000,000.

Penalty for failing to achieve share price targets, £500,000.

Penalty for failing to achieve lending targets, £500,000.

Penalty for failing to achieve restructuring targets, £500,000.

Penalty for failing to achieve balance sheet targets, £500,000.

Which is already the case in reality, but clearly it's not explained very well as some folks just don't seem to get it....:cool:

Graham_Devon

CLAPTON wrote: »

wrong

the vaccinations are provided free of charge; the doctors get paid for each vaccination they (or the nurse usually) performs,
just like they are incentivised (i.e. paid bonus) to carry out lots of routine procedures

Wrong?

You do realise I order them? You do realise I deal with the invoices?

We have to buy them. We are allowed to return so many, in multiples of 100 to the companies if they are unused.

We then claim back the money for each vaccination given.

It's not part of the general contract, hence attracts a contractual payment per patient immunised.

If we order too many, it costs us.

Graham_Devon

Rinoa wrote: »

Just in.

BBC says Hampton has given up the £1.4m shares reward he was due to get.

http://www.bbc.co.uk/news/uk-politics-16772525

Is this the bonus that they were suggesting was now worth nothing?

homelessskilledworker

Thrugelmir wrote: »

That's because they have a lack of genuine policy currently. Get in the media by taking a completely opposed view.

Yawn.....

Nobody is going to take Labour seriously for a long time..
Their answer in the good times is to borrow, their answer in the bad times is to borrow. Lets face it, they are like the flash boyfriend with the flash car and shiny teeth who max out on the credit card to impress the girlfriend while the Dad looks on knowing it will eventually end in tears when he is caught out.

Look at the way the spivvy Labour Mp's were flipping properties, how they abused their second home allowance. How the like of Goulde were caught trying to sell their inside knowledge at £2000 per day because as Gould put it "He had kids to get through uni". How Blair is now one of the most skilled tax avoiders in the UK, this a man from the old socialist party.

And for what it is worth and for the decency of hard working people I would let the Banks now fail, and to hell with the consequences.

ejc81

Rinoa wrote: »

Just in.

BBC says Hampton has given up the £1.4m shares reward he was due to get.

http://www.bbc.co.uk/news/uk-politics-16772525

He didn't have much of a choice really did he. I mean he would have looked like a total t**t if he had of accepted it, after the storm that this has caused.

sabretoothtigger

There is a very simple solution that would have stopped Goodwin and works fine now for both parties.

Allow any bonus but only in ordinary shares of the company being managed, they are awarded annually but cannot be sold for 10 years.
This stops insider dealing or manipulation and gives the CEO an incentive not to wreck the company before he gets to sell them

The UK people own 80% of RBS shares, its a very good idea if the fortunes of the workers running it are also dependant on the share value not going to zero

The actual bonus forfeited doesnt matter, in the scheme of things its not a big bill to the company

CLAPTON

sabretoothtigger wrote: »

There is a very simple solution that would have stopped Goodwin and works fine now for both parties.

Allow any bonus but only in ordinary shares of the company being managed, they are awarded annually but cannot be sold for 10 years.
This stops insider dealing or manipulation and gives the CEO an incentive not to wreck the company before he gets to sell them

The UK people own 80% of RBS shares, its a very good idea if the fortunes of the workers running it are also dependant on the share value not going to zero

The actual bonus forfeited doesnt matter, in the scheme of things its not a big bill to the company

Goodwin had a considerable shareholding in RBS and so he made a massive loss.

Do you really think for one moment that Fred actually thought he was wrecking the company?

wotsthat

brenii wrote: »

How come the shareholders of RBS, the citizens of the UK who funded the purchase of the shares in RBS do not get a vote.

The citizens of the UK are not shareholders and don't get a vote. RBS is state owned - the taxpayer owned guff is a bit of spin that's all.

You own RBS in the same way you own Buckingham Palace. Try popping down there and attempting to adjust the central heating settings - no-one will mind - after all it's own by the citizens of the UK.

You do get a say though - if you don't like the way the government controls state owned assets vote for someone else.

misskool

I was wondering where this whole owned by the taxpayer thing comes from. As a UK taxpayer, I must own loads of stuff, can I vote on who gets to drive on my share of the roads? Can I vote on what my NHS hospital is allowed to treat?