Lloyds shareholders told to rebuff £11.5m pay package for bank's boss

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Shareholders in Lloyds Banking Group are being urged to vote against a “highly excessive” £11.5m pay deal for António Horta-Osório, the boss of the bailed-out bank.

The call from Pirc, a leading advisory service on corporate governance for major investors, came before the bank’s annual general meeting on Thursday.

According to Reuters, Pirc also raised concerns about Norman Blackwell, the bank’s chairman, because he holds other boardroom positions. Lord Blackwell is also chairman of support services company Interserve although has indicated his intention to step down.

Other advisory bodies are not thought to have raised concerns about the £11.5m cash and shares deal for Horta-Osório. The package was announced in February when the bank announced a rise in profits and the resumption of its dividend for the first time since the 2008 banking crisis. At the time, Frances O’Grady, the general secretary of the TUC, said voters would want to know why the government had not done more to hold back the pay deals at the bank.

The taxpayer owns just over 20% of Lloyds – down from 43% at the time of the 2008 bailout following the rescue of HBOS. The most recent sales have taken place as a result of a sell-off programme put in place by the previous government in December to cut the stake in six months to just below 20% by drip-feeding shares into the market. The shares have rallied recently, which has led to reports that the government is likely to achieve this goal.

The shares were trading at 86p on Monday, above the 73.6p average price at which the government bought them during the bailout.

In the last budget before the election, the chancellor, George Osborne, said he intended to raise a further £9bn from the sale of more Lloyds shares over the coming 12 months, possibly with a retail offering to investors.

Lloyds already has the largest private investor base in the UK with about 3 million small investors, a legacy of its rescue of HBOS which was created from the former Halifax Building Society.

The bank did not comment before its AGM.

Powered by Guardian.co.ukThis article was written by Jill Treanor, for theguardian.com on Monday 11th May 2015 19.43 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010


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