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Lloyds boss 'won't take bonus'
Nicholas Cecil11 Feb 2009
Lloyds chief executive Eric Daniels said today that he will not take a bonus for last year.
Lloyds Banking Group is 43 per cent owned by the taxpayer and his decision emerged hours before he and other bank chiefs were due to face a grilling from MPs.
His move will pile pressure on senior staff at other banks to follow suit.
Tory MP Michael Fallon, vice-chairman of the all-party Commons Treasury committee, stressed that publicly owned banks should cut back dramatically on the special payments.
He said: "There is no case for bonuses, certainly cash bonuses, until they have sorted themselves out." Mr Fallon added that any share bonuses had to be linked to a clear "exit strategy" for the taxpayer to get a return on the public investment into the banks.
Mr Daniels, whose salary is just more than £1 million, could have qualified for a bonus of 225 per cent of his salary - more than £2million.
His decision is understood to have been a personal one and there is no guarantee that fellow board members will follow suit. He is believed to have waived his bonus given the public anger prompted by the payments.
Committee chairman and Labour MP John McFall said: "It's important that the banks look forward and engage with the public and make amends to repair their PR image."
A spokesman for the Lloyds Banking Group, which includes rescued lender HBOS, declined to comment.
Mr Daniels's action was likely to ease the pressure on the top executives at the country's main high-street lenders when they appear before MPs today.
Yesterday the former bosses of Royal Bank of Scotland and HBOS offered their "profound" apologies for their part in the banking crisis, despite vigorously defending their individual actions.
Today much of the focus was expected to be on the current RBS chief executive, Stephen Hester, after the bank refused to rule out bonus payments, even though it is now 69 per cent state-owned after a £20 billion taxpayer bail-out.
The bank's defiant stance provoked a furious response with Gordon Brown vowing "aggressive" action to sweep away "the old short-term bonus culture".
But RBS denied a report that Mr Hester could walk away with a payment of nearly £4 million if he is sacked, insisting it has no obligation to pay him if he is dismissed.
Those bankers who are still receiving bonuses, however, are likely to see their payout plummet 70 per cent from their 2007 peak, according to City experts.
The Centre for Economics and Business claimed that "the public has a completely inaccurate perception of what makes up bankers' bonuses".
Reader views (3)
thats good of him and will he pay back the huge bonus from years gone by?
- M.O'Brien, london.uk, 11/02/2009 16:54
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At any normal company he would now be signing on.
- Alan, Llandrindod Wells, 11/02/2009 16:09
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Mr Daniel's one-off waiving of his right to a bonus is not the important point. The scandal is that, in the present parlous state of his bank, he had the right to a bonus at all. The criteria for the award of bonuses seem absurdly lax.
- Richard, London, London. UK, 11/02/2009 14:41
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