RBS to overhaul executive pay scheme

26th Apr 2010 14:50

Government-owned lender Royal Bank of Scotland has confirmed it will impose stricter criteria on its long-term bonus scheme for bosses.Shareholders will be asked to vote in favour of the new scheme, which will raise the target price that triggers payments from 50p, at Wednesday's annual meeting, the bank said."An extensive consultation has been undertaken and the remuneration committee will give close consideration to the range of shareholder views before reaching a final position," read a statement."The share price has been hugely volatile in the last year and that needs to be taken account of in a way that ensures the scheme is both motivating and exacting in performance terms. This is the board's intent and the remuneration committee will endeavour to align all interests in the matter."Chairman Sir Philip Hampton is fully expected to flag an increase to targets set for chief executive Stephen Hester.Hester, whose rolling three-year incentive plan runs until the end of 2012, boasts an annual salary of about £1.2m and last year waived his bonus of £1.6m after a public backlash against bankers' bonuses.