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RBS chief executive told he is paid to much by parents

Tony Lambert — Tue, 12 Jan 2010 15:48:15 +0000

Royal Bank of Scotland chief executive Stephen Hester told parliament that even his parents believed that he was overpaid. Hester was answering questions put to him by the Treasury Select Committee of MPs.

The Select Committee is investigating pay and bonuses of the state-controlled banks. Even though his friends and family believe he is over paid, Stephen said his package was worthless at the moment as he has agreed to take no cash in the first year, however it could be worth almost £10 million over three years.

Hester took over from Sir Fred Goodwin in October 2008. Hester asked to be paid the going rate of someone in the private sector and not the public. He did not comment on other top staff, because he needed to talk to the staff about there bonuses, which will happen at the end of next month.

He did however tell the parliament that shareholders “have raised concerns about our ability to keep and motivate the good people.”

To read more on this story go to business timesonline.co.uk.

RBS Third Quarter Loss £3.3 Billion: Bad Loans and Writedowns

Tony Lambert — Fri, 06 Nov 2009 13:16:39 +0000

Britain’s largest government controlled bank the Royal Bank of Scotland Group Plc (LON:RBS), have announced a third quarter loss after £3.3 billion ($5.5 billion) of provisions for bad loans and credit-market write downs.

Fund manager at private bank Brown Shipley & Co John Smith said “RBS is still a recovering basket case, but it’s going in the right direction.” The net loss was 1.8 billion pounds, compared with a profit of 871 million pounds in the year earlier period. This was not good news but it could have been worse. The shares gained as much as 8.6 percent in London trading.

RBS is the world’s most expensive bank bailout getting a total of 45.5 billion pounds in capital from the British taxpayer. This week, the 70 percent government owned lender said it would sell its insurance assets, more than 300 U.K. branches, an investment banking division and a credit card payment unit to win EU approval for taxpayer aid.

To read more on this story go to bloomberg.com.

RBS: Citizens Bank Won’t Be Sold

Tony Lambert — Thu, 05 Nov 2009 16:13:30 +0000

Citizens Bank will not be sold off, as European regulators spared the company from a possible forced sale tied to the breakup of the Royal Bank of Scotland (LON:RBS).

European regulators considered how to break up RBS into smaller pieces. The breakup is part of a $40 billion bailout plan, the second for RBS following last year’s financial panic. The chairman and chief executive of Citizens Financial Group Ellen Alemany said on Tuesday, “Today’s announcement once again affirms that Citizens is a valued part of the RBS Group.”

The company can trace its roots to 1871 and became part of the Royal Bank of Scotland in 1988. Citizens Financial Group has a $153 billion in assets and, through various subsidiaries, run’s 1,480 branches in 12 states.

RBS had been ordered by British government officials to sell the Providence-based Citizens. But the government rescinded the ordered sale after RBS officials balked, according to news accounts. However, RBS will be forced to sell more than 300 branches in the United Kingdom, including NatWest offices in Scotland within four years.

To read more on this story go to tradingmarkets.com.

Government rules doesn’t stop cash payout

Tony Lambert — Thu, 05 Nov 2009 10:19:25 +0000

It seems that despite the bank’s promise to only pay rewards in shares, hundreds of Royal Bank of Scotland (LON:RBS) top traders could walk away with huge cash bonuses next summer.

Senior management and traders who receive share bonuses will be allowed to cash them out as soon as they are awarded, according to an internal letter from RBS chief executive Stephen Hester to his staff this week. Hester said: ‘The first installment of the deferred award, to be released in June 2010, will be settled in the form of either shares or debt which can be turned into cash at recipient’s option.”

This means that although bonuses for 2009 will still be deferred and spread over three years, key staff will be able to sell their shares as soon as they get them. Liberal Democrats Treasury spokesman Lord Oakeshott said: ‘This is utterly outrageous. Alistair Darling’s statement in Parliament gave no clue that bankers would be cashing in a third of their bonus in only seven months time.

RBS said: ‘The government has imposed the toughest pay conditions anywhere in the world on RBS.’ It points out that it is sticking to G20 principles that bonuses ought to be paid in shares. This comes after the government committed to inject a further £25.5billion to support RBS, in addition to the £20billion it gave last autumn. To read more on this story go to dailymail.co.uk. What do you think on huge cash bonuses next summer paid by RBS?

RBS plans to hire advisers for Asset Management

Peter — Mon, 18 May 2009 13:27:51 +0000

Royal Bank of Scotland (LON:RBS) are said to be hiring advisers to help offload RBS Asset Management, this is the bank’s fund unit that invests on behalf of clients of its private banking subsidiary, Coutts.

The Sunday Telegraph

has reported that RBS executives have been in discussions with Morgan Stanley NYSE:MS), over a possibility of purchasing the division, which has assets of more than $50bn (€37.2bn). It is estimated to be worth £500m (€562.8m).

Both the FSA and RBS have not made any comment on these rumors, so we will just have to wait and say how these events will unfold.

Royal Bank Of Scotland (RBS) News: Trading Update

Peter — Fri, 08 May 2009 07:28:40 +0000

Royal Bank of Scotland (LON:RBS) has made a small first-quarter loss, as the part-nationalised lenders bad debts quadrupled. RBS has now taken another 2.1 billion pound ($3.2 billion) writedown on risky assets. The first quarter loss was £44 million; compare that to a £479 million profit a year ago.

Reuters Feast ipod

reports that RBS’s bad debts in the three months until the end of March 2009 have increased to £2.9 billion, compare that to £656 million a year ago. RBD say that this is a result of corporate and retail impairments increasing in all businesses and sectors.

Royal Bank Of Scotland (RBS) is just the latest of the big European banks to say that bad debts were ratcheting as the economy in all regions worsen, along with increased unemployment. Stephen Hester, chief executive of RBS has said that both 2009 and 2010 will be very tough for the bank.

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News on Royal Bank of Scotland's (RBS) exit from Asia

Peter — Thu, 23 Apr 2009 10:17:19 +0000

Royal Bank of Scotland (RBS) (LON:RBS) thought that its exit from its Asia operations would help to save the ailing bank money, but it seems that this move could actually be less lucrative and more time consuming.

Reuters

say that the bank is likely to fetch nearer $1 billion once it sells all of its Asian assets, many experts had expected this to be around $2 billion. The reason for this is that regulators will take a long look at the assets of the bank.

Royal Bank of Scotland Razor’s Ring movie full buy Body and Soul Harper movie full (RBS) has not told anyone how much they expect to make from selling these assets. HSBC Holdings Plc (LON:HSBA), Standard Chartered Plc (LON:STAN) and Australia & New Zealand Banking Group (ASX:ANZ) are all set to make bids for these assets.

Government's stake in RBS now 70 per cent

Peter — Wed, 15 Apr 2009 14:14:44 +0000

The UK government has now raised its stake in RBS (Royal Bank of Scotland) (LON:RBS) to 70 per cent. The comes after the bank has completed a swap of preference shares which was held by the government for ordinary shares.

Previously the UK government held a 58 per cent stake of ordinary shares in RBS after investing £20 billion last year to keep the bank trading. Only a few of the bank’s shareholders decided to take the opportunity to buy 16.9 billion new shares in the Royal Bank of Scotland at 31.75 pence.

Business Week reported that RBS trading was down 3.4 percent to 28.2 pence in midday trading. The government also holds a 43 per cent stake in the Lloyds Group.

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RBS forces construction company collapse: 500 jobs lost

Peter — Wed, 11 Mar 2009 09:05:07 +0000

RBS (Royal Bank of Scotland), (LON:RBS) have been blamed for the collapse of construction company, Wrekin. The company has been forced to lay off 500 workers after RBS demanded that Wrekin repay its £2.8 million overdraft.

Wrekin had hoped that the Bank would be able to give them a bit of breathing space, as the company has a £40 million order book, and just last night received another order worth £10.

This news will be a bitter blow to many other British companies who owe RBS money, as the bank is still lending billions to foreign companies. The Royal Bank of Scotland is now 80 per cent owned by the taxpayer, and the bank said that they would lend British businesses £16 billion this year.

If the bank fails to achieve this target by the end of the year, then RBS will have to prove to the Treasury that this was a result of borrowers not applying for loans.

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RBS Chief’s £1.6 Million Pension: Taxpayer’s Foot Bill

Peter — Tue, 10 Mar 2009 09:50:59 +0000

If you thought the size of Sir Fred Goodwin’s £703,000 pension was big, then think again. Royal Bank of Scotland (RBS) (LON:RBS) chief, Larry Fish’s is to receive £1.6million, that is more than twice the amount of Sir Fred’s.

That works out at more than £30,000 per week for Larry Fish, who was the former chairman and chief executive of RBS’s US arm Citizens he retired last year. This means that the taxpayer is now paying for his pension, how can this keep going on.

RBS

cannot say that Mr. Fish put into the pension, as it is 98 per cent unfunded. This means that most of the money will come from the bank’s earnings, as they are now sate controlled; it is you and I who will pay for his pension.

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