RBS admits bankers pay is 'astonishingly high'

30th Apr 2010 11:06

Royal Bank of Scotland's (RBS) chairman thinks the salaries earned by top bankers are "astonishingly high", but says they're needed to stop good staff jumping ship.Sir Philip Hampton admitted to the BBC Today programme it was hard to defend multimillion pound pay cheques doled out to senior executives.But he claimed RBS, 83% owned by the taxpayer, would haemorrhage talent if it didn't pay the market rate."If we don't pay our top people, they leave very quickly. Our top people are very much in demand and we have seen a significant loss of our top people," Hampton said.At the AGM earlier this week, he promised to review performance targets linked to the bank's controversial bonus scheme.The existing Medium Term Performance Plan and Executive Share Option Plan will be replaced with a new Long Term Incentive Plan. "Awards will be subject to tough performance criteria and to a stringent risk review, so that no awards will vest unless there has been effective risk management and good progress against the strategic plan during the performance period," he told shareholders. The new scheme will raise the target price that triggers bonus payments for bosses from 50p. Chief executive Stephen Hester, whose rolling three-year incentive plan runs until the end of 2012, will certainly see his targets increased, though by how much remains to be seen.