There are a swathe of articles in the press today, concerning RBS:

The Times, The Sun, The BBC and many others are out putting their spin on the situation - and even Robert Peston has been provoked into blogging on the topic!

This is the way The Times puts it:

The Treasury signalled last night that it was prepared to veto a £1.5 billion bonus pool at Royal Bank of Scotland in a move that could trigger the resignation of the bank’s board.

RBS directors have been advised by the bank’s lawyers to resign if a Treasury bonus veto means they are unable to run the bank commercially and in the best interests of all shareholders.......

Ronnie Fox, principal of Fox Lawyers, said: “If you are put in a position where you can no longer do the job you are paid to do then I cannot see how you can remain in place as a director. I would advise the board of RBS to resign in this situation.”

Vince Cable, the Liberal Democrats Shadow Chancellor, said: “I would welcome their resignations. The bank cannot hold the taxpayer to ransom.”

The Treasury has intervened directly to demand the right of veto over this year’s bonus payments at the bank, which is 70 per cent controlled by the taxpayer.

Institutional shareholders have raised concerns that restricting RBS’s ability to make reasonable bonus payments this year will impede the bank’s ability to compete commercially and retain top bankers next year. Investors have urged Stephen Hester, the chief executive, to drive a hard bargain with the Treasury over the final size of the bonus pool.

RBS said last night: “Our agreed business plan requires us to operate commercially in competitive markets and this plan underpins the prospects of recovering value for taxpayers and other shareholders alike. We understand and embrace the need to ensure pay meets the new G20 and Financial Service Authority requirements and will continue to advocate this and other ways to address public concerns relating to banks and always pay on the principle of no rewards for failure.”

One shouldn't underestimate the seriousness of this situation. This is a potential LOSE-LOSE of massive proportions!  The Government is applying pressure because of the expectations they have been wrongly stoking in the public.....all the populist rhetoric about "greedy bankers" is now on the…

Unlock the rest of this article with a 14 day trial

Already have an account?
Login here