Financial News
- 4 February 2013, 22:41
RBS Told To Pay Libor Fine From Bonus Pot
Chancellor George Osborne wants any fine paid by the Royal Bank of Scotland over the Libor scandal to come out of its bankers' bonuses.
RBS, which is majority-owned by the taxpayer, is expected to agree a fine of £400-500m next week with US and British authorities.
It is accused of attempting to rig benchmark interest rates.
Sky's City Editor Mark Kleinman said: "A Treasury source has told Sky News that the money that the US regulators will fine RBS will have to come out of the bank's bonus pot.
"It's very important politically, I think, for the Chancellor to be able to say that the taxpayer is not bearing the financial cost of misconduct by bankers who work for a company that is majority-owned by the taxpayer.
"The Treasury is obviously playing hardball on this, and we'll find out exactly how much RBS is going to be paying in fines in the coming days."
The Treasury expects the fines to be paid not just from the bonus pot for 2012 - likely to be around £250m - but money from future years' bonus pots as well.
RBS - which is 81% owned by taxpayers - is also looking to claw back up to £100m from pay deals previously awarded to executives in its investment bank.
The bank's remuneration committee, which is chaired by Penny Hughes, a non-executive director, is assessing plans for a "flat tax" on the pay packets of hundreds of directors and managing directors in its markets business.
The idea would involve about 15% of prior-year pay awards to the relevant individuals being clawed back, netting a total of as much as £100m.
"George Osborne is sending out a clear signal: 'You're paying for this, not us'," said Sky's Glen Oglaza.
"What the Treasury are saying is there won't be bonuses paid this year, but actually your bonuses are going to be clawed back not just this year but probably next year and the year after as well."
Barclays was fined £300m last year for its role in the scandal.
what do you think?
sunshine
OK Phil - let's not recoup any of the fines from the bonus pot. Stop you're moaning and move forward. If any Uk bank had collapsed then citizens of the Uk would really know what financial hardship means.
chrishearn350
Well Sunshine had the uk tax payer had the £70.000+ each that we gave to the banks we might now have a better economy. The people running it are meant to be experts and look at the B..... mess its in !
movvi
Blah blah blah; tum tiddly pom. These were my thoughts reading this. It's a head wrecker and I shouldn't wander onto the finance pages, clearly. They make me malfunction.
stevie may
Wont stop bankers continuing to scam the country. Nothing will when the system itself is corrupt, immoral and pernicious. Capitalism makes slaves of us all
Ben Ralph
If you work for a bank that has been bailed out, there should be no bonuses whatsoever until is taxpayers are paid off. And all of this rubbish about "you have to pay to keep the best talent" I don't see American banks fighting to take our bankers. Why? Coz they're as bad as their own!
Michael Hawkins
Keep up Ben The bank paid back the money last May
ListenToTeacher
Libor = lie more
dave
Excellent idea - bet he chickens out though.
chrishearn350
The Treasury expects the fines to be paid not just from the bonus pot for 2012 - likely to be around £250m - but money from future years' bonus pots as well. What is this Bonus pot is it the one full of customers and Tax payers money ? !
Michael Hawkins
Keep up chris RBS paid back the loans last MAY yet the government have retained 80% of the company - the only losers are the share holders
chrishearn350
Keep up Michael .Having the emergency loans repaid by RBS will not mean taxpayers have made all their money back as the government still owns an 81% stake in the bank, for which it paid £45.5bn.
Michael Hawkins
Chris how much of the £45.5 billion was paid to the owners - the share holders ?
happymike CHESTER
All this means we will pay out in the end reduced interest on savings increased interest on loans. The Banks are there to make money out of money and we suckers are paying, kerb their greed and start gaoling them.
Michael Hawkins
Move your account to the nationwide if you are worried
Phil A
6:12pm on 2/2/2013
It's very important politically, I think, for the Chancellor to be able to say that the taxpayer is not bearing the financial cost of misconduct by bankers who work for a company that is majority-owned by the taxpayer. IS THIS A JOKE!!!!!! We've paid millions to them because of their misconduct in other areas, regardless of how much of the company the tax payer owns. They really must think we are all as thick as two short planks.