Ulster Bank CEO bows to pressure on annual bonus
ULSTER BANK chief executive Jim Brown bowed to political pressure last night and agreed to waive his annual bonus for 2012 in response to the unprecedented technical crisis that has affected tens of thousands of customers for a third week.
Mr Brown said in a statement last night “everyone at Ulster Bank is completely focused on putting things right for our customers”.
“I don’t want there to be any doubt that this is also my personal priority,” he said. “I am personally committed to re-earning the trust of our customers. I have therefore informed the Ulster Bank board that I do not wish to be considered for an annual bonus for 2012.
A spokeswoman for the bank declined to say how much Mr Brown was forgoing as a bonus for the year. The New Zealand banker was appointed chief executive of Ulster Bank last year by the bank’s UK parent company, Royal Bank of Scotland.
Earlier yesterday, Mr Brown’s refusal to rule out a bonus this year was described as “astounding” and “beyond belief” by Fianna Fáil TD Michael McGrath at an Oireachtas finance committee hearing.
Mr Brown was one of three senior executives from the bank and RBS to appear before the Oireachtas finance committee to discuss an “unprecedented” technical failure that has left more than 100,000 customers without access to funds for more than two weeks.
He said the scale of the problem was worse than the bank had thought and the number of customers affected by the system collapse would exceed 600,000, six times the bank’s initial assessment.
While much of the discussion revolved around what went wrong and why it was taking the bank so long to resolve the problems, the most fractious moments came when Mr Brown refused to discuss his remuneration or bonus.
Mr McGrath said accepting a bonus this year “would be rubbing customers’ noses in it” but Mr Brown would say only that the situation would be reviewed at the end of the year. “I don’t know if I will get a bonus or not,” he said.
When pressed as to whether he would accept one, he said: “I will make that decision at the end of the year.”
“That you would even consider accepting a bonus is beyond belief,” Mr McGrath responded.
Sinn Féin’s Pearse Doherty called on Mr Brown to resign once the current crisis was resolved but the latter declined to discuss his future with the bank and said his sole focus was resolving the crisis.
Fine Gael’s Kieran O’Donnell also pressed him on his bonus but Mr Brown said he was not prepared to discuss the issue further. He also refused to disclose how much he earned when asked by Independent TD Shane Ross.
Mr Brown described the details of his salary as “private information which I don’t want to share”.
He said bank customers who wanted to know how much he was paid would have to wait until October, when the information would be published in the bank’s annual report.
He was accompanied by Chris Sullivan, chief executive of UK corporate banking at RBS, and Jim Ryan, managing director of branch banking with Ulster Bank.
Committee chairman Alex White asked the three if they could confirm reports that the Edinburgh-based IT team responsible for the software that failed had been halved in size recently, with widespread redundancies imposed, but all three said they did not know, something Mr White described as extraordinary.
When asked about compensation, Mr Brown said a team was looking at what could be done for customers “over and above the costs incurred”. “I would expect to be able to make an announcement early next week,” he added.
He said resolving the problems had been “complex, time- consuming and frustratingly slow”, but he expressed confidence that a resolution was in sight and said the company was set to meet its target of having “the vast majority” of accounts in order by July 16th.