LONDON – The British government has vetoed a plan by part-nationalized Royal Bank of Scotland to pay bonuses of up to double annual salaries.
The bank had planned to put the bonus proposal to shareholders.
The Treasury said there could be no rise in the bonus cap because the bank has not yet completed its restructuring and remains 81 per cent state-owned after a 2008 bailout.
It said Lloyds Bank, which is 25 per cent state owned, would be allowed to seek the 2:1 bonus ratio because it had almost finished restructuring.
RBS said the decision put it at a commercial disadvantage.
Authorities have moved to curb stratospheric bonuses after the 2008 global banking crisis. New European Union rules limit annual payouts to 100 per cent of annual salary, or 200 per cent with shareholder approval.