Royal Bank of Scotland chief executive Stephen Hester will give up his bonus in 2012, after technical glitches in the last week left thousands of customers unable to access their accounts. It’s not the first time Mr. Hester has forgone pay: He turned down a $1.5 million stock award for 2011, and a larger amount still in 2009.
News of Mr. Hester’s latest bit of abstinence comes after Barclays boss Robert Diamond said neither he nor three top lieutenants would take a bonus for 2012, after the lender announced it would pay $451 million to settle charges it had manipulated interbank lending rates, leaving The Observer to wonder why British banking executives are quicker to hold themselves accountable then their American cousins.
Citigroup chief executive Vikram Pandit earned a salary of $1 and no bonus in 2010, of course, after his bank suffered losses in previous years, a bit of noblesse which seemed less laudable when Citi’s board awarded Mr. Pandit about $15 million for 2011, plus a retention plan worth about $40 million. (Citi’s shareholders moved against Mr. Pandit’s 2011 pay package at a non-binding vote at this year’s annual meeting. It remains to be seen whether the bank’s board will heed that recommendation.)
Bank of American chief Brian Moynihan has been denied a cash bonus in each of the last three years, though in 2009 and 2011, Mr. Moynihan earned stock awards in excess of $5 million and $6 million respectively.
Still, the news out of Britain stands in contrast to a report this morning that JPMorgan let chief investment officer Ina Drew walk away with more than $21 million in compensation she would have forfeited had she been fired.
Instead, the manager responsible for the London Whale trading losses was allowed to resign, and while JPMorgan CEO Jamie Dimon has suggested clawbacks are on the table for executives responsible for the losses, compensation experts tell Bloomberg that Ms. Drew’s resignation makes it unlikely she’ll be forced to give back pay.
In the aftermath of which news, Mr. Hester’s comments about his 2012 bonus were especially welcome: “I don’t deserve one and wouldn’t take one,” he told the BBC.