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The City's top regulator has turned down his bonus for the last year, sending a signal to bankers and directors that they need to cut back on their fat-cat rewards.
Financial Services Authority chief executive Hector Sants, who has been a key figure in bailing out UK banks and building societies over the past 12 months, was awarded a bonus of £130,000 for 2008. But he declined to accept it.
The watchdog's annual report published today explains: "In view of the wider public debate relating to levels of bonuses payable in the financial services industry and the role of the FSA in seeking to reach conclusions on its regulatory approach to the issue, Mr Sants declined to accept the award."
The news comes a day after Royal Bank of Scotland said its new chief executive Stephen Hester could make up to £9.7 million in pay and bonuses if he puts RBS back on the rails.
It also follows Sir Stuart Rose's humiliation at Marks & Spencer after an investor revolt forced him to hand back £1.16 million of his chairman's bonus.
Elsewhere in the banking world, directors have been forced or volunteered to give up millions of pounds of bonuses in 2008.
Eric Daniels, chief executive of Lloyds Banking Group, reluctantly forswore what was expected to be a £2 million-plus payout hours before he appeared before a House of Commons committee to explain the disastrous takeover of HBOS.
The entire board of Barclays, including chief executive John Varley and multi-million-pound earner Bob Diamond, gave up their bonuses ahead of a "back us or sack us" vote at the bank's annual meeting.
All the top brass at UBS, the bank with the largest credit-crunch losses in Europe, gave up their entitlement to any 2008 bonus.
But rival Goldman Sachs is already lined up to pay massive bonuses for 2009.
Sants' total pay and perks package fell from £662,000 to £623,000.
New FSA chairman Adair Turner received £247,000 for the six months he has been in the job.
Sants said: "I hope we have begun the process of rebuilding confidence in the system and the regulator by demonstrating that we are an organisation that is willing to learn, and that we have the ability to change radically.
"I believe enduring and respected organisations are forged in times of adversity and that this will ultimately be seen as such a time for the FSA."
Reader views (1)
Well done Mr Sants, a good example set. We need to get rid of this sense of entitlement that city high flyers have. That and criminal prosecutions wherever possible.
- Dave Stephens, London, 25/06/2009 14:40
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