RBS share price: Investors urged to block CEO pay

Royal Bank of Scotland Group (LON:RBS) investors have been urged to vote against the bank’s remuneration plans, Reuters has reported. The news comes ahead of the bailed-out lender’s annual general meeting next week.

Tuesday’s trading saw the RBS share price close at 262.50p. The group’s shares have added less than three percent to their value over the past year, as compared with a near four-percent gain in the Footsie.

Investors urged to block CEO pay

Reuters reported yesterday that shareholder advisory group PIRC had recommended  shareholders block RBS’ remuneration report, arguing that chief executive Ross McEwan’s overall payout of £3.6 million was ‘excessive’. The shareholder body explained that his total variable pay, which stands at 211 percent of salary, was too high, coming on top of his £1-million base pay.

The newswire, however notes that rival investor advisors Glass Lewis and ISS have recommended that shareholders back the bank’s pay proposals. PIRC meanwhile further pointed out that the ratio of chief executive to average employee pay at the firm was 46:1, which the advisory group reckons is ‘unacceptable’.

The comments come ahead of the group’s AGM on April 25, which will be followed by the bailed-out lender’s first-quarter results on April 26.

FTSE 100 peer Lloyds Banking Group (LON:LLOY) meanwhile is facing pressure over pension arrangements after it emerged over the weekend that investors were warning over a director’s remuneration deal, shortly after the bailed-out lender’s chief executive António Horta-Osório recently gave up his pension deal following staff criticism.

Analysts on bailed-out lender

Jefferies reaffirmed the bailed-out lender as a ‘buy’ last week, while Barclays continues to see the company as ‘overweight,’ with neither specifying a target on the RBS share price. According to MarketBeat, the part government-owned bank currently has a consensus ‘buy’ rating and an average valuation of 309.77p.