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RBS shareholders back remuneration report | |
(about 7 hours later) | |
Royal Bank of Scotland (RBS) has said 99% of shareholders who voted at its annual general meeting in Edinburgh approved its remuneration report. | |
There had been warnings of discontent over £607m of staff bonuses awarded during a year when it lost £5.2bn. | |
Payouts by the 81% state-owned bank angered investors after a "chastening" 2012. | |
But at the AGM the bank argued it was on a stronger footing and all resolutions were passed. | |
Ahead of the meeting, shareholder advisory body Pirc called for investors to reject its pay report over excessive rewards. | |
It said: "The bottom line is that the bank, similarly to its major competitors, has a remuneration structure which can lead to excessive pay." | |
Bonus pot | Bonus pot |
Bosses also said the bank should be ready for a return to the private sector by next year. | |
In 2012, RBS said it sought to "put right past mistakes" as it aside money to cover PPI mis-selling, the mis-selling of interest rate swaps and its fine for attempting to fix Libor. | |
Earlier this month, it swung out of the red with pre-tax profits of £826m for the first three months - its best performance since the third quarter of 2011. | Earlier this month, it swung out of the red with pre-tax profits of £826m for the first three months - its best performance since the third quarter of 2011. |
Chief executive Stephen Hester said: "The clean-up of RBS can be accomplished under our own steam in the next year, year and a half. | Chief executive Stephen Hester said: "The clean-up of RBS can be accomplished under our own steam in the next year, year and a half. |
"I think we will be substantially done next year." | "I think we will be substantially done next year." |
That could see the Treasury begin selling its stake in the bank next year. | That could see the Treasury begin selling its stake in the bank next year. |
While its £607m bonus pool in 2012 was down 23% on £789m a year earlier, it included £215m for investment bankers. | While its £607m bonus pool in 2012 was down 23% on £789m a year earlier, it included £215m for investment bankers. |
However, the bank said it was recouping £302m for its Libor settlement by cutting the 2012 bonus pot, clawing back from previous years and reducing current year awards. | However, the bank said it was recouping £302m for its Libor settlement by cutting the 2012 bonus pot, clawing back from previous years and reducing current year awards. |
At the general meeting in Edinburgh, RBS was also expecting to face questions over an IT meltdown last summer which locked up to 17 million customers out of their accounts. | |
Toxic assets | |
City watchdog the Financial Conduct Authority (FCA) has started a probe into the fiasco in June and July last year, which saw payments go awry, wages appear to go missing and home purchases and holidays interrupted. | City watchdog the Financial Conduct Authority (FCA) has started a probe into the fiasco in June and July last year, which saw payments go awry, wages appear to go missing and home purchases and holidays interrupted. |
The glitch affected customers of RBS, NatWest and Ulster Bank, and prompted Mr Hester to hand back his bonus for 2012. | The glitch affected customers of RBS, NatWest and Ulster Bank, and prompted Mr Hester to hand back his bonus for 2012. |
The bank could face a fine, censure or both for the incident which reportedly followed a botched attempt to update software on its payment processing system. | The bank could face a fine, censure or both for the incident which reportedly followed a botched attempt to update software on its payment processing system. |
It has already taken a £175m hit to cover costs and compensation for the incident. | It has already taken a £175m hit to cover costs and compensation for the incident. |
However, the lender also underlined its progress on shrinking the bank and returning it to health. | |
Last year it quit the UK government's £282bn Asset Protection Scheme without making a claim on it and also floated its insurance arm, Direct Line Group. | Last year it quit the UK government's £282bn Asset Protection Scheme without making a claim on it and also floated its insurance arm, Direct Line Group. |
RBS is also trying to find a buyer for more than 300 branches after a deal to sell them to Santander fell through last year. | RBS is also trying to find a buyer for more than 300 branches after a deal to sell them to Santander fell through last year. |
Mr Hester has rejected suggestions the lender should be split into a "good" and "bad" bank, to separate out toxic assets. | Mr Hester has rejected suggestions the lender should be split into a "good" and "bad" bank, to separate out toxic assets. |
In a recent newspaper interview, he said it would be costly and time-consuming. | In a recent newspaper interview, he said it would be costly and time-consuming. |
RBS is majority-owned by the taxpayer after a £45bn bailout at the peak of the financial crisis in 2008. | RBS is majority-owned by the taxpayer after a £45bn bailout at the peak of the financial crisis in 2008. |
Friends of the Earth Scotland demonstrators held a protest outside the bank's AGM in Edinburgh. | |
They claimed RBS was "funding the wholesale destruction" of the Appalachian mountains in the USA, and elsewhere, by mining coal deposits. |
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