RBS stresses need to pay bonuses

15th Dec 2009 12:57

Royal Bank of Scotland chairman Philip Hampton today insisted the lender needed to pay 'commercial' bonuses to reward staff, but denied reports that the board threatened to walk out over government limits to pay-outs.'Contrary to a number of media reports, there have been no threatened mass resignations of the board, at any time,' Hampton said.However, he added that board members were committed to running the bank on a commercial basis.'We are committed to ensuring that we run the group in a commercially viable manner... We see our ability to pay competitive rates to our staff as essential to this.'Hampton's comments came as RBS shareholders gathered for a special meeting in Edinburgh to vote on the bank's plans to join the government's insurance scheme. The EU commission has already cleared the bailout of the bank, which is 70% government-owned.More than 99% of shareholders eventually backed the government bail-out plan and bonus payment, thought to be worth about £1.5bn. They agreed to accept £25.5bn of state cash that takes the government's stake to 84.4%, on top of £8bn of extra aid and £2.1bn fee to be part of the Asset Protection Scheme (APS) to insure £280bn of loans.'Without these measures RBS would be at risk of full nationalisation, and in that event independent shareholders could very well lose most or all of the value in their shares,' Hampton had warned.