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Royal Bank of Scotland is set to pay investment bank head John Hourican a £4 million ($6 million) bonus this year, the FT reports.There’s a few reasons this might be somewhat controversial:
- The RBS investment wing was not successful, and RBS plans to dramatically scale back this part of their business.
- British taxpayers own 83 per cent of RBS.
- At the end of last year, Chancellor George Osborne told RBS to scale back its “risky activities”.
- On Sunday, British Prime Minister David Cameron vowed to crackdown on executive pay (“golden parachutes”) in financial sector.
All in all, this is shaping up to be an ugly confrontation between RBS and its government overlords.
A Downing Street representative told Sky News that the government will “engage with RBS to discuss executive pay over the coming weeks and will make sure that pay reflects and rewards performance”. RBS denies any decision on bonuses has been made.