NatWest plans to pay cash bonuses to senior bosses

Bloomberg

British bank NatWest Group Plc plans to start paying its management cash bonuses, warning that compensation levels are falling “too far” behind competitors.
The UK’s biggest corporate lender is seeking to introduce annual bonuses plus restricted share plan awards to replace the current long-term incentive program, the bank said in its annual report. The changes, which are subject to shareholder approval, would mean a 19% boost in total compensation for Chief Executive Officer Alison Rose and a 13% hike for Chief Financial Officer Katie Murray.
“We believe that continuing an approach that is materially behind our peers is imprudent,” the Edinburgh-based bank said in its annual report. “A move towards a more flexible remuneration structure, which delivers more competitive levels of pay, is justified and in the best interests of the business.”
Once one of the world’s largest banks, NatWest has been transformed into a largely domestic retail lender following a string of scandals. The UK government has a majority holding but continues to sell down the stake it acquired during the financial crisis over a decade ago.
The bank cited its path to private ownership as a reason for the changes, which would be phased in over two years. British newspaper The Times first reported that NatWest would start paying cash bonuses to its top staff.
Rose became the first woman to run one of Britain’s big four lenders when she was promoted to CEO in 2019. She was formerly the bank’s head of British commercial and private banking. In 2018, NatWest named Murray to succeed Ewen Stevenson as CFO. The company changed its name from Royal Bank of Scotland Group Plc in July 2020.
NatWest reported its fourth-quarter profit beat analyst estimates. After setting aside about 3.2 billion pounds ($4.4 billion) in the early stages of the pandemic to cushion against potential bad debt, the bank is now reversing these charges to reflect the recovering economy.