FOUR SENIOR executives at Ulster Bank owner Royal Bank of Scotland, which is majority owned by the UK government, could be in line to receive shares now worth almost £5 million (€5.7 million).
RBS had to be bailed out by British taxpayers in October and reported losses of £24.1 billion for 2008. The bank has been at the centre of a storm since it emerged that Sir Fred Goodwin, its former chief executive, is receiving a pension of £703,000 per year in spite of bringing the bank to its knees.
RBS was also criticised this year when it paid staff bonuses of up to £950 million for 2008 in spite of its taxpayer bailout.
RBS has outlined a medium-term incentive plan for four senior executives eligible to collect the shares in three years if certain performance criteria are met. The targets will be connected to the extensive turnaround of the bank, which has been instigated by Stephen Hester, the new chief executive.
It is expected to take between three and five years to return RBS to health. Ron Teerlink, chief administration officer, and Alan Dickinson, chairman of the UK corporate banking division, have both been awarded options of over 1.88 million RBS shares, which would potentially be worth £768,676 on paper as of Friday.
Chris Sullivan, taking over as chief executive of the UK corporate banking division, has been awarded options over 1.77 million shares, potentially worth £723,837. Ellen Alemany, chairman and chief executive of RBS’s US operation Citizens, has been awarded options over 5.897 million shares, potentially worth £2.4 million.
RBS said the shares would only be released if strict performance criteria were met on the turn-around of RBS. It pointed out that the shares were designed to tie in executives who are best placed to revive the bank. If targets are not met then there will be no shares.
The awards could be clawed back in future if the bank were to face large losses. The bank said: “We have put in place a new team to lead RBS through the substantial restructuring we have under way . . .These incentives are designed to do just that and there will be no reward for failure.”
