“Experts have analysed the pensions of a number of former directors of British banks, many of which were only saved from collapse by state bailouts. The biggest beneficiary is former Royal Bank of Scotland director Larry Fish, who has a pension pot of £18m, paying out £1.5m a year. Unlike the former RBS chief executive Sir Fred Goodwin, he has managed to maintain a low profile up to now, as he used to run the bank’s American operations.
Other bankers with pension pots of more than £1m include: Richard Banks, Richard Pym and Chris Rhodes (Alliance & Leicester); Steve Crawshaw and Chris Rodrigues (Bradford & Bingley); Peter Cummings, Colin Matthew and Phil Hodkinson (HBOS); David Baker, Robert Bennett, Keith Currie, David Jones and Andy Kuipers (Northern Rock); and Johnny Cameron and Mark Fisher (RBS).
The analysis also established that the true value of Sir Fred Goodwin’s pension pot could be, in fact, almost double the previously stated figure of £16m. According to pensions expert John Ralfe: “The official numbers that Royal Bank of Scotland has come out with is that his total pension pot from the age of 51 to the expected death is about £16.9m. I think that is a gross understatement. If I wanted to go along to a third-party pension provider and get the sort of pension that Fred Goodwin is on – £700,000 and that goes up in line with inflation, of course, each year – I would have to pay something in the order of £28m.”
The contrast with the pensions given to rank-and-file banking staff could not be greater. Dennis Grainger, who worked at Northern Rock for a decade, is entitled to only £700 a year. “I’m so disgusted with this I’ve turned it down,” said Mr Grainger.
Vince Cable, the Liberal Democrat Treasury spokesman, has attacked the scale of the rewards: “What makes people really, really angry is that these people were exceptionally well paid, got enormous pension pots and other payments, despite the fact that they have failed and they have failed their shareholders, failed their employees and failed the taxpayer, and they are walking away with their millions.”
The large payments are not limited to pensions. Bank bosses have seen their average salaries rise from £800,000 in 2006 to more than £1m in 2008 – 20 per cent more than the average pay packet of chief executives in other sectors. They now earn £255,000 a year more than their FTSE-100 counterparts. Fees paid to non-executive directors of banks have also risen. In the case of the RBS, non-executive directors have seen their fees almost treble in less than a decade, from £25,000 a year in 2000 to £73,000 a year in 2008.
Mr Cable has denounced bankers’ pay and perks as “the kind of things you would associate with absolute monarchies in the days of the Bourbons in France”.
Sir Fred Goodwin
Even after cashing in £2.7m of his pension, he gets £550,000
Sir James Crosby
Will start reaping rewards of £10.4m pension pot in 2011 £572,000
Lawrence Fish
£18m pension fund yields over a million every year £1.5m
Adam Applegarth
In 2022 he will be able to claim his full yearly pension £305,000
Andy Hornby
The former HBOS chief can take his pension at 50 £240,000
Michael Fairey
Opted to take his entire £7m pension pot as a lump sum £280,000″