Abu Dhabi Royals Involved in RBS Talks: Sources

REUTERS.COM: Talks to sell a stake in Britain's state-owned Royal Bank of Scotland (RBS.L) are being held at the level of the Abu Dhabi ruling family, sources told Reuters on Tuesday.

A source familiar with the matter said Amanda Staveley, a businesswoman notable for her Middle Eastern connections, was advising the emirate's rulers.

"The talks have been going on for six months, and nothing is likely to materialize for the next few months," the source said, adding that Abu Dhabi could end up with a stake of more than a third, though it has not decided which of its entities would hold the stake.

Staveley played a prominent role in Abu Dhabi royal Sheikh Mansour bin Zayed al-Nahayan's 2008 investment in another British bank, Barclays (BARC.L).

A senior banker told Reuters that the oil-rich emirate's sovereign wealth funds were not involved in talks at this stage.

"It's happening higher up," the banker said, adding that a deal could fall apart on price grounds. Two other banking sources also said that a deal, if it happened, would be struck at a government-to-government level.

"Abu Dhabi is always talking to parties to invest, including RBS. Whether it will materialize or not is too early to say," a source close to the royal family said on condition of anonymity. » | Stanley Carvalho and Mirna Sleiman | ABU DHABI/DUBAI | Tuesday, Mar 27, 2012

About Amanda Staveley, the deal-making queen:

LONDON SPECTATOR: Dealmaking Queen Amanda Staveley Marries Her Prince » | Tuesday, March 27, 2012

Related »

MPs Blast 'Ridiculous' Pay in RBS Bonus Row
TIMES ONLINE: Politicians rounded today on Royal Bank of Scotland (RBS), the state-owned lender, over its decision to pay up to £1.7 billion in bonuses to bankers despite making a £3.6 billion loss during 2009.

The bank announced today that it would pay investments bankers from a £1.3 billion bonus pool while other staff would share in a £400 million reward.

George Osborne, the Shadow Chancellor, said that bankers’ pay had reached “ridiculous levels”, adding: “We have just got to look at the whole banking sector and try to bring this pay down.”

RBS’s loss for the 12 months to December 31 is less than the £5 billion expected and far below the £24.3 billion loss that RBS reported for 2008, a record for any British company.

But Vince Cable, the Liberal Democrat Treasury spokesman, said: “RBS rewarding individual bankers is like a football team paying their striker for scoring when they’ve just been relegated."

RBS is 84 per cent owned by the British taxpayer after receiving billions of pounds of rescue funds from the state during the recession to save it from collapse.

The UKFI, the body set up by the Government to manage the state’s investment in British banks, yesterday granted RBS permission to pay the bonuses. >>> Francesca Steele | Thursday, February 25, 2010

Stephen Hester Lines Up £1.6m RBS Bonus
RBS cheif executive Stephen Hester. Photograph: The Sunday Times
THE SUNDAY TIMES: Taxpayer banks set to report £12bn losses as bosses agonise over their big bonus payouts

STEPHEN HESTER, chief executive of Royal Bank of Scotland, is in line to collect a bonus of up to £1.6m despite the bank posting losses of several billion pounds.

Talks over the bumper payout are expected to reach a conclusion within days and could be announced alongside the bank’s results later this week.

Although the 49-year-old has yet to make a final decision on whether to accept the pay deal, it is understood that the conditions in his contract would permit a large payout.

The deal comes amid continuing controversy over bonuses at taxpayer-backed banks. RBS, 84%-owned by the state thanks to huge injections of government funds, will confirm this week that it is to pay out £1.32 billion in bonuses to its investment bankers.

Lloyds Banking Group is expected to award £200m to its staff and is on a collision course with investors over a bonus for Eric Daniels, its chief executive.

The payments come against a stark financial backdrop at the two banks. Lloyds and RBS are expected to post combined losses of about £12 billion this week, following enormous charges for bad debts. >>> Iain Dey and Dominic O’Connell | Sunday, February 21, 2010

Wall Street Giants Pay Staff $100bn
THE SUNDAY TIMES: FOUR of Wall Street’s biggest banks will this week reveal plans to pay their staff a total of close to $100 billion (£62 billion), reigniting the row over bankers’ bonuses.

Goldman Sachs, Morgan Stanley, Citigroup and Bank of America Merrill Lynch are all expected to announce bumper pay awards for staff alongside full-year results.

Wall Street’s big payouts come as the remuneration committee at Royal Bank of Scotland prepares to meet this week to determine the size of its bonus pot.

RBS — 84%-owned by British taxpayers — has indicated it wants to pay its investment bankers about £1.5 billion in bonuses, even though it will make a loss this year at group level. The figure could creep higher if it attempts to shelter its bankers from the impact of Alistair Darling’s 50% tax on bonuses. >>> Iain Dey | Sunday, January 17, 2010

Even My Parents Think I'm Overpaid, Admits RBS Chief Executive
THE GUARDIAN: But Stephen Hester tells MPs that although his bonus package could be worth up to £10m, it is currently worthless as shares in the state-controlled bank have failed to rise

Stephen Hester giving evidence to the Treasury select committee today. Photo: The Guardian
Stephen Hester, chief executive of Royal Bank of Scotland, admitted today that his parents believe he is paid too much as he stressed that his bonus package was currently worthless because the bank's shares had failed to rise.

Asked by the Treasury select committee of MPs whether he understood why the government wants to restrict bonuses at the state-controlled bank, Hester replied: "Yes".

He insisted that the bank did not yet know the size of the bonus pot that would be split between its 22,000 investment bankers. Hester also revealed that a "handful" of highly paid bankers would avoid the restriction placed on the bank not to pay cash bonuses to anyone earning more than £39,000 because of legal commitments made to them.

He told the MPs, who are also taking evidence from his counterparts at Lloyds Banking Group and Northern Rock, that his "biggest single business problem" was recruiting people who were concerned about the criticism they might encounter if they work for RBS.

Institutional investors had "raised concerns about our ability to keep and motivate good people".

The bank would not tell staff whether they will get a bonus and how large it would be until the end of February, he said.

The Treasury has a power to veto bonuses at the bank under the terms of insuring £282bn of troubled loans through the asset protection scheme (APS). Hester insisted no board directors have threatened to resign as a result of this restriction and insisted he wanted to pay "the minimum possible while keeping staff engaged".

Of his own pay deal, which is linked to the RBS share price but could be worth almost £10m over three years, Hester said: "If you ask my mother and father about my pay they'd say it was too high as well, so some people close to me have that view of bankers." >>> Jill Treanor | Tuesday, January 12, 2010

THE GUARDIAN – BUSINESS BLOG: Bank pay row reaches a crescendo: Banks are preparing to snub the politicians and begin a bumper bonus round later this week. First they have to brave a few final assaults: Obama's threatened tax in America and the House of Commons Treasury committee >>> Dan Roberts | Tuesday, January 12, 2010

Addicted to Bonuses: The Fat Slobs at RBS Just Can’t Get Enough
Bonus showdown: Stephen Hester, Chief Executive of Royal Bank of Scotland. Photo: Mail Online
MAIL ONLINE: Royal Bank of Scotland directors were accused of holding taxpayers to ransom last night over plans to pay huge bonuses.

The board has threatened to resign en masse if the Treasury blocks the payments.

The row is over an estimated £1.5billion bonus pool for staff at the investment arm of the bank, which is largely owned by the public.

The pool is around 50 per cent bigger than last year and would give 20,000 bankers the equivalent of three times the national average salary each.

The Treasury has demanded a veto, following the taxpayers' £45billion bailout of the Edinburgh institution, but board members say their lawyers tell them they would have to resign if they lost the power to set pay levels.

It is an astonishing challenge to the Government, whose stake in the bank is set to rise to 84 per cent in the coming weeks.

Liberal Democrat spokesman Vince Cable said: 'I would welcome their resignations as they cannot hold the taxpayer to ransom. It's absolutely right that the government should impose bonus discipline on this bank.'

'As a state-run bank, the Government must finally take control and ensure that both its pay and lending practices are in the public interest.' Held to ransom by the bankers: Bosses at RBS (Yes, YOU own it) threaten to quit if they can't dole out huge bonuses >>> Simon Duke | Wednesday, December 02, 2009

THE TELEGRAPH: Lord Myners: 5,000 bankers earn more than £1m: At least 5,000 bankers will earn more than £1 million this year, according to the Government's City minister Lord Myners. >>> Harry Wallop, Consumer Affairs Editor | Wednesday, December 02, 2009

Big City Bonuses Are Back
MAIL Online: City banks are preparing to lavish record bonuses on staff less than a year after bringing the world economy to the brink of meltdown.

Many high-flying traders and dealmakers are looking forward to ' mindblowing' payouts on a par with the rewards handed out at the height of the banking boom in 2007.

This is despite many of the banks only being able to turn a profit because they have been bailed out with taxpayers' money.

Wall Street giant Goldman Sachs is expected to confirm next week that it will pay an average of almost £400,000 in pay and bonuses to each of its 5,500 London-based staff - a total of £2.2billion.

Its profits are soaring on the back of the $6.2billion it received from the U.S. taxpayer last year.

Royal Bank of Scotland recently revealed chief executive Stephen Hester was in line for a £9.7million pay package if he brings the bailed-out bank's share price up to 70p.

Another bailed- out financial giant, Citigroup, is raising basic pay for many of its investment bankers and traders by up to 50 per cent, to make up for the loss in bonus pay.

Nationalised U.S. insurance firm AIG is planning to pay millions of dollars more in bonuses to dozens of top bosses across the world.

Last year it paid out more than £100million despite being rescued by the U.S. government after racking up £60billion in losses from reckless bets on toxic debt.

Credit Suisse, Deutsche Bank, JP Morgan, Morgan Stanley and Barclays are also planning major rewards.

This is despite their actions triggering a recession which is expected to cost a million Britons their jobs.

The return of 'business as usual' to the banking sector makes a mockery of the Government's claim to have stamped out the culture of greed and reckless risk taking in the banking industry. Big City bonuses are back! Less than a year after banks took billions in taxpayer-funded bailouts... >>> Simon Duke | Saturday, July 11, 2009

City Bankers Are Already Lining Up for Bonuses Again
After helping the world get into its financial mess, bankers at HSBC are now lining up for renewed bonuses. Photo courtesy of MailOnline
MAIL Online: HSBC bankers are in line for bumper bonus payouts after an 'encouraging' jump in profits.

While the company's performance added impetus to a day of good economic news, the re-emergence of the City's discredited bonus system will be an embarrassment for Gordon Brown, who has promised to outlaw reckless behaviour in the Square Mile.

Taxpayer-controlled Royal Bank of Scotland has already started offering 'guaranteed' bonuses to traders in defiance of promises it made to rein in no-strings-attached rewards.

And Barclays is gearing up for massive payouts after profits rose 15 per cent in the first three months of 2009.

The culture of extravagant bonuses encouraged bankers to take ever bigger risks, laying the ground for the gravest financial crisis since the Great Depression of the 1930s. >>> By Simon Duke | Tuesday, May 12, 2009

RBS: Sir Fred Goodwin 'Thinking About' Shredding His Pension
THE TELEGRAPH: Former Royal Bank of Scotland boss Sir Fred Goodwin - known as 'Fred the Shred' - is considering a "voluntary reduction" in his £703,000-a-year pension payout, the bank has confirmed.

Chairman Sir Philip Hampton said Sir Fred was thinking about the move, but said it was too soon to know what the outcome would be.

He said: "I've asked Sir Fred if he would consider a voluntary reduction and he's told me he's thinking about that."

The comments come ahead of the bank's annual general meeting in Edinburgh later on Friday, when angry shareholders are expected to vote down RBS's remuneration report in protest at Sir Fred's controversial pension payout.

RBS - now majority-owned by the taxpayer - also warned of more job losses in the UK and internationally as it said the 2,700 announced so far this year for the UK were "not the end of the story".

The embattled bank said it was still unclear how many redundancies would be made, but stressed it would do "all it can" to keep compulsory redundancies to a minimum.

The group is laying off staff as part of a plan to cut £2.5 billion from annual costs within the next three years. >>> | Friday, April 3, 2009

Bailed-out Royal Bank of Scotland Bankers Set for Millions in Bonuses
TIMES ONLINE: RBS to reward staff in spite of losses

The troubled Royal Bank of Scotland, rescued with £20 billion of public money, is planning large bonuses for thousands of its City traders and senior bankers, The Times has learnt.

The proposed payments are expected to reach tens of millions of pounds — possibly hundreds of millions — with some star bankers in line for six-figure payouts.

UK Financial Investments (UKFI), the Treasury-run body that holds the Government’s RBS stake, is understood to have given its blessing in principle to limited payments, although it has yet to see the details. “There’s no blanket objection to bonuses, but they are subjecting them to intense scrutiny,” said one well-placed source. “The [bonus] numbers will be very large and very difficult for the general public to understand.” >>> Patrick Hosking, Banking and Finance Editor, and Philip Webster, Political Editor | Thursday, February 5, 2009

The Dawning of a New Dark Age (Paperback & Hardback) – Free delivery >>>

Rescued Bank to Pay Millions in Bonuses
THE GUARDIAN: RBS 'making monkeys' out of the government, says Vince Cable

Royal Bank of Scotland, which is being bailed out with £20bn of taxpayers' money, has signalled it is preparing to pay bonuses to thousands of staff despite government pledges to crack down on City pay.

The bank has set aside £1.79bn to cover "staff costs" - including discretionary bonuses - at its investment banking division for the first six months of the year alone. The same division caused a £5.9bn writedown that wiped out the bank's profits for the same period.

The government had demanded that boardroom directors at RBS should not receive bonuses this year and the chief executive, Sir Fred Goodwin, is walking away without a pay-off. But below boardroom level, RBS and other groups are preparing to pay bonuses to investment bankers who continue to generate profits.

The disclosure drew fierce criticism from Vince Cable, the Liberal Democrat Treasury spokesman.

"The government said they would attach strict conditions on bonuses and it is very clear they are doing nothing of the kind.

"The banks are just making complete monkeys of them." >>> Simon Bowers | November 1, 2008

The Dawning of a New Dark Age (Paperback & Hardback) – Free delivery >>>

Financial Crisis: Banks Nationalised by Government
THE TELEGRAPH: The Government has begun nationalising the British banking industry, pumping £37 billion of taxpayers' money into HBOS, Royal Bank of Scotland and Lloyds TSB.


RBS will receive £20 billion of capital from the Government - leaving taxpayers holding a 63 per cent stake in the company. Its chief executive, Sir Fred Goodwin, is to resign.

A further £17 billion is to be injected into the merged HBOS-Lloyds TSB, meaning 41 per cent of the new "superbank" will effectively be owned by the public.

Before the merger, taxpayers will own around 58 per cent of HBOS after the Treasury bought shares worth £8.5 billion and preference shares worth £3 billion and 30 per cent of Lloyds TSB after buying shares worth £4.5 billion and preference shares worth £1bn.

Gordon Brown said the "unprecedented but essential" move was "something that matters for every family and business in Britain."

"We must, in an uncertain and unstable world, be the rock of stability on which the British people can depend," the Prime Minister said.

"To let the chips fall where they may would be the height of irresponsibility," he told a Downing Street news conference.

"The Government can not just leave people on their own to be buffetted about."

Describing the move as a reaction to "exceptional, extraordinary" times, the Chancellor, Alistair Darling, admitted that Government borrowing would have to soar to fund the deal. However he insisted that taxpayers would get their money back.

He said that the intervention was a crucial step in the international fight-back against the financial crisis, and that other governments would now follow Britain's example.

"We are living in extraordinarily turbulent times," he told BBC Radio 4.

"This is a model that other countries are going to adopt, because this is a truly global problem."

Mr Brown confirmed that as part of the deal, the Government will appoint directors to the banks' boards of directors, with three being sent to RBS and two to Lloyds TSB-HBOS. No bank executives will receive bonuses this year, he said. Financial Crisis: Banks Nationalised by Government >>> By Andrew Porter, James Kirkup, Gordon Rayner and Jon Swaine | October 13, 2008

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