RBS shareholders vent their anger

New chairman Sir Philip Hampton faced calls for the previous board, which oversaw £24 billion of losses last year, to be jailed.

The embattled institution, which is now majority-owned by the Government, announced earlier that the 2,700 staff previously earmarked to be axed were "not the end of the story".

Shareholder John Waterson voiced "grave reservations" about the make-up of the present board - particularly Gordon Pell and Guy Whittaker, who were both on the bank's previous board.

"It begs the question: why are these two individual gentlemen still on the board of directors at Royal Bank of Scotland?" Mr Waterson asked, to applause from shareholders in the audience.

"As a group of executive directors they are collectively responsible for what has happened to this wonderful, great company. They've brought the share price to the level of what would appear to be a penny share.

"Far from continuing with them as members of the board - I am sure I speak for a lot of people in this audience - all of those board members should be in jail."

Sir Philip told the meeting at the Edinburgh International Conference Centre that 12 board members had departed since October last year and Mr Whittaker and Mr Pell have his "total confidence".

Despite earlier reports from the bank, former Royal Bank of Scotland boss Sir Fred Goodwin is not considering a "voluntary reduction" in his £703,000-a-year pension, according to sources.

Sir Fred is understood to have told the bank he would not hand back any of the retirement package, despite assurances earlier on Friday from the bank's chairman that he was thinking about whether to make a reduction. Sources said he believed he has fulfilled all his contractual obligations and expected the bank to fulfil theirs in return.