Anger at pay hike plan for RBS top staff

THE boss of Royal Bank of Scotland has come under fire over plans to give hundreds of top staff a pay rise after the Chancellor blocked the bank’s attempts to dish out bonuses of twice salary.

Revealing a statutory profit of £1.2bn for the first three months of the year – the biggest since the financial crisis – Ross McEwan made clear he would do whatever it takes to hold on to highly paid bankers.

George Osborne last week overruled RBS’s plans to ask shareholders for permission to pay bonuses of up to twice salary.

RBS is now restricted to paying bonuses of a maximum one year’s salary – the lower limit imposed by the EU bonus cap introduced in January.

The bank has warned the restriction poses a risk, as rivals are all applying to shareholders to pay bonuses of double basic salary.

McEwan indicated that less than 0.5pc of 116,000 staff will be affected. This still means that up to 580 people could see a boost in their basic package.

Deborah Hargreaves, chair of the High Pay Centre, said: ‘This is nonsense. Top bankers should not be able to hold banks to ransom.’

Shares in RBS soared more than 8pc to 331.7p, adding £1.6bn to its value, after the lender revealed first quarter profits had tripled.

Profits were £1.6bn. RBS said it did not have to set aside more money for mis- selling payment protection insurance and interest rate swaps.

Losses from bad loans dropped by almost two thirds to £362m.

This boosted RBS’s troubled Ulster Bank which broke into the black for the first time since 2009, making a £17m profit.

But McEwan warned of potential setbacks ahead, including large restructuring costs, fines and litigation, and lower returns on asset sales.