Key Northern Rock staff receive secret bonuses
http://business.timesonline.co.uk/to...cle3177668.ece
"SENIOR staff at Northern Rock are receiving secret bonuses of up to £100,000 a year as part of an incentive scheme.
The bank’s board approved the bonuses for 173 staff who are seen as essential for the running of the bank. The payouts, of up to £25,000 per quarter, could double the salaries of some of the recipients.
In a letter to senior staff on December 20, the chief executive, Andy Kuipers, said the “enhanced remuneration package” was for employees deemed “essential to our continuing excellent operational performance”.
He emphasised that the arrangement “will not be offered to the generality of staff and, as such, must remain absolutely confidential to yourself and not be discussed with others. If you do discuss the existence of this bonus to any third party then you will forfeit your entitlement”.
The revelation will cause anger among customers, the bank’s remaining 6,000 staff, and taxpayers, whose exposure to Northern Rock is about £55 billion, including £25 billion in loans from the Bank of England. Alistair Darling, the chancellor, will also face embarrassment as the Treasury, Bank of England, and Financial Services Authority (FSA) were informed of the bonus plans.
Last night the Treasury tried to distance itself from the fallout, claiming the government was powerless to intervene. A source said: “ Yes, we were appraised of these bonuses, but it was not for us to say yes or no to it. They have their own independence to run things.”
A spokesman for the FSA said: “We have been informed but remuneration is a matter for the company, not the regulator.”
The payouts triggered anger among opposition politicians. A Liberal Democrat Treasury spokesman said: “Northern Rock is being kept afloat entirely by the taxpayer. The company could not even pay its gas bill without taxpayers. The Treasury must not hide behind the fiction that this is a private company.”
Last night Brian Giles, head of corporate affairs at Northern Rock and thought to be one of those who could receive up to £100,000, confirmed the incentive scheme had been put in place but refused to go into detail.
The Treasury took a further step towards the nationalisation of Northern Rock this weekend by recruiting Ron Sandler, the troubleshooter who rescued the Lloyd’s insurance market, to lead the ailing bank if it goes into public ownership.
At an extraordinary meeting on Tuesday shareholders will try to block the sale of Northern Rock to the Treasury. But there are doubts about whether a private owner could keep it afloat and a plan has been drawn up by John Kingman, a Treasury official, for the bank to be owned and managed as a nationalised entity."
It's always reassuring to know my taxes are well spent rewarding the success of a key financial institution. The management of Northern Rock are exemplars for us all.
http://business.timesonline.co.uk/to...cle3177668.ece
"SENIOR staff at Northern Rock are receiving secret bonuses of up to £100,000 a year as part of an incentive scheme.
The bank’s board approved the bonuses for 173 staff who are seen as essential for the running of the bank. The payouts, of up to £25,000 per quarter, could double the salaries of some of the recipients.
In a letter to senior staff on December 20, the chief executive, Andy Kuipers, said the “enhanced remuneration package” was for employees deemed “essential to our continuing excellent operational performance”.
He emphasised that the arrangement “will not be offered to the generality of staff and, as such, must remain absolutely confidential to yourself and not be discussed with others. If you do discuss the existence of this bonus to any third party then you will forfeit your entitlement”.
The revelation will cause anger among customers, the bank’s remaining 6,000 staff, and taxpayers, whose exposure to Northern Rock is about £55 billion, including £25 billion in loans from the Bank of England. Alistair Darling, the chancellor, will also face embarrassment as the Treasury, Bank of England, and Financial Services Authority (FSA) were informed of the bonus plans.
Last night the Treasury tried to distance itself from the fallout, claiming the government was powerless to intervene. A source said: “ Yes, we were appraised of these bonuses, but it was not for us to say yes or no to it. They have their own independence to run things.”
A spokesman for the FSA said: “We have been informed but remuneration is a matter for the company, not the regulator.”
The payouts triggered anger among opposition politicians. A Liberal Democrat Treasury spokesman said: “Northern Rock is being kept afloat entirely by the taxpayer. The company could not even pay its gas bill without taxpayers. The Treasury must not hide behind the fiction that this is a private company.”
Last night Brian Giles, head of corporate affairs at Northern Rock and thought to be one of those who could receive up to £100,000, confirmed the incentive scheme had been put in place but refused to go into detail.
The Treasury took a further step towards the nationalisation of Northern Rock this weekend by recruiting Ron Sandler, the troubleshooter who rescued the Lloyd’s insurance market, to lead the ailing bank if it goes into public ownership.
At an extraordinary meeting on Tuesday shareholders will try to block the sale of Northern Rock to the Treasury. But there are doubts about whether a private owner could keep it afloat and a plan has been drawn up by John Kingman, a Treasury official, for the bank to be owned and managed as a nationalised entity."
It's always reassuring to know my taxes are well spent rewarding the success of a key financial institution. The management of Northern Rock are exemplars for us all.
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