Stephen Hester, the Chief Executive of Royal Bank of Scotland (RBS), will not accept his bonus share award, according to several reports on Monday morning.
The decision follows the opposition Labour party threatening to force a vote on the issue in the House of Commons. Under the terms of his contract, Hester is due an award of RBS shares worth around £963,000 based on the price of RBS shares at the end of January.
The UK tax payer owns 83% of RBS, for which it paid the princely sum of £45bn.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
There had been mounting political anger at a tax payer funded bank handing out a bonus to an employee who already receives a salary of £1.2m.
The award was agreed in recognition of Hester's moves to "de-risk" the bank, which back in 2008 almost collapsed after borrowing too heavily and failing to refinance its debts.
Over the last 12 months the stock is broadly flat although over the last five years RBS has lost 96% of its value.
BS
-
FTSE 100 hits record highs – why is it rising and will we see more gains?Advice UK equities have been described as unloved for a long time but as the FTSE 100 hits new highs, we explain if now is the time to buy British.
-
How to invest in copperIt may be time to invest in copper as the red metal appears poised for a big jump. Dominic Frisby looks at what should investors should buy
