The Daily Telegraph reports that Royal Bank of Scotland (RBS) is to increase the base pay of some its investment bankers in order to change the compensation mix, placing less reliance on year-end bonuses. And, according to the newspaper, in some instances this will mean that salaries will double.
Although the review is likely to take a few more months to complete, some of the Managing Directors in the firm's Global Banking & Markets (GBM) division, which employs 16,000 staff, could see their base pay hiked as high as $462,000 (£300,000). Directors could see increases to $308,000 (£200,000).
An RBS spokesperson told Reuters: 'We are reviewing compensation within GBM to ensure that we continue to retain and attract key staff, which is currently a key focus of the division. The review will ensure we continue to pay in line with the market, but we fully recognise our role and responsibility towards leading market reform in the area of compensation while meeting the long term interests and needs of the company'.
One banker told Here Is The City: 'The levels of base pay mentioned for Directors and above seem on the high side, but if these figures end up proving to be true, it can only mean one thing - RBS must feel that large bonus payouts are off the agenda for some time to come'.
Finally, The Sunday Times reports that RBS suffered the biggest loss from that 2007 Goldman Sachs CDO transaction that US market regulator The Securities and Exchange Commission (SEC) is claiming was fraudulent . The bank is said to have lost around $841m, and is said to be examining whether it has any grounds for legal action against Goldman. Goldman has denied wrongdoing, and is to fight the SEC fraud charges.