RBS share price: Group likely to leave bonus pool little changed this year

Final decision expected to be made in January

RBS share price: Group likely to leave bonus pool little changed this year

Royal Bank of Scotland Group (LON:RBS) is likely to leave its bonus pool little changed this year, Bloomberg has revealed. A final decision is reportedly expected to be made next month.

RBS’ share price has been little changed in London in today’s trading, having slipped 0.14 percent to 280.30p as of 13:34 GMT, underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.25 percent higher at 7,472.12 points. The group’s shares have added more than 30 percent to their value over the past year, as compared with about a seven-percent gain in the Footsie.

Bonus pool likely to be little changed

Sources with knowledge of the matter told Bloomberg today that RBS was likely to leave its bonus pool little changed this year, ending a spate of annual declines in payouts dating back to the financial crisis. Last year, the bailed-out lender slashed its compensation pool by eight percent to £343 million, bringing the drop since 2010 to about 75 percent with the group having trimmed its investment banking operation.

One of the sources noted to the newswire that the bonus structure for senior executives at RBS remained designed to encourage the employees’ performance in the longer term. A final decision on the discretionary awards reportedly has not been made and will be taken in January. RBS meanwhile is scheduled to update investors on its full-year performance on February 23.

The news comes after reports suggested last week that the Financial Conduct Authority had decided not to publish a report on the group’s controversial restructuring division because it feared being sued for ‘unfair treatment’ by the bank.

Analysts on RBS

In ratings news, Citigroup reaffirmed RBS as ‘neutral’ last week, without specifying a price target on the shares. According to MarketBeat, the company currently has a consensus ‘hold’ rating and an average price target of 264.67p. 

As of 14:04 GMT, Tuesday, 12 December, Royal Bank of Scotland Group share price is 280.30p.

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