April 25, 2014 / 6:46 AM / in 4 years

RBS says UKFI would reject any 2:1 bonus proposal

LONDON, April 25 (Reuters) - Part-nationalised Royal Bank of Scotland said on Friday that the body responsible for managing Britain’s stake in the bank will vote down any resolution proposing bonuses of 200 percent of fixed pay.

The bank said UK Financial Investments informed the bank of its opposition to a 2:1 variable-to-fixed pay ratio, which it said was emerging as the “sector norm”, and therefore the board would not bring forward such a proposal at its annual general meeting.

“The board acknowledges that this outcome creates a commercial and prudential risk, which it must try to mitigate within the framework of a 1:1 fixed-to-variable compensation ratio,” it said.

Reporting by Clare Hutchison; editing by Jane Baird

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