Royal Bank of Scotland’s chief executive needs to be given the freedom to complete his turnaround plan without excessive interference, the bank’s chairman said yesterday.
“There are… still risks on the horizon and the task of rebuilding RBS has some way to go,” Philip Hampton said yesterday at the bank’s annual shareholder meeting.
“It is important… that the RBS management team is given the support and the freedom they need to continue their work to make us still safer and stronger,” said the chairman of the bank that also owns Ulster Bank.
A row flared up earlier this year with some politicians attacking the bonus proposed for chief executive Stephen Hester, prompting criticism from business groups that there was too much political interference in the bank, which is 83% nationalised.
UK Financial Investments, which manages the British government’s stake, said it voted in favour of all resolutions at the AGM, including on pay. That allowed the bank to avoid the backlash seen in past years and at its rival Barclays last month, although there were some protests at the AGM.
“I’d like to see them show more restraint (on pay). There never used to be this kind of pay given out by Scottish banks,” said shareholder Tom Wilson, 74.
Mr Hampton said the task of turning around the bank was unprecedented, after RBS became one of the world’s biggest banks before nearly collapsing in 2008.
“The business will need a top management team to be in place to have the best chance of maximising value when the time comes for the UK government to sell its interests.”
RBS’s insurance arm, Direct Line, was “increasingly well positioned for a planned flotation of the business”.
RBS has picked UBS to work alongside Goldman Sachs and Morgan Stanley as bookrunners on the listing, that could value the business at over £3bn (€3.75bn).