“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″
Tag Archives: pensions
Adrian Ash: Here Comes Stagflation
The whole inflation-deflation debate has always struck me as misbegotten. People use the terms to mean things so varied that it’s pointless to argue. But such as it is, I’m a firm believer in the deflationary thesis on the macro level… influenced in this by the economist Antal Fekete , and his theory of how capital is destroyed in a fiat money regime.
Nonetheless, I do see consumer prices rising.
In other words, asset prices fall, industry contracts, and unemployment levels stay high, while the stuff on the shelves costs more, insurance and tuition rates climb, and living in general becomes more expensive. Continue reading
Allied Irish Chairman Pelted with Eggs
In the news, BBC reports on another kind of Blackrock – Blackrock, South Dublin, where Gary Keogh was hastily removed from a building after chucking eggs at Dermot Gleeson, chairman of Keogh’s bank, Allied Irish. The outburst came at a shareholder’s meeting of Allied Irish to approve a 3.5 billion euro government recapitalization for the bank, which has lost 91% of its value over the past 12 months.
Said Keogh,
“I have no pension. My pension now is wiped out because of AIB. I cannot sell the shares because they are useless.
If we didn’t live in a tolerant society, the chairman and the rest of the board would be hanging by their necks with piano wire out on the road.
Meanwhile, inside, an unsettled Mr Gleeson stood in front of a blue AIB logo spattered with egg and continued to take questions from shareholders….”
My Comment
Hooray for Mr. Keogh.
Any society can only take so much ‘tolerance’ and ‘non-judgmentalism’ without bankrupting itself financially and spiritually.
The moral problem underlying all this is that we deny that actions have consequences. And we also refuse to judge our actions by their consequences.
We want to make every action free of consequence, although consequences are precisely what guide us in ordinary life.
We’re accountable when we drive on the roads, aren’t we?
So why do bankers get to abdicate that responsibility when it comes to larger social and economic issues?