LONDON – The chief executive of Royal Bank of Scotland Group Plc, parent of Providence-based Citizens Financial Group Inc., said Tuesday that even his parents think he makes too much money.
RBS CEO Stephen Hester made the comments in testimony before the House of Commons Treasury Committee in London. The British government became the bank’s majority owner after bailing it out with 45.5 billion pounds ($73 billion).
“If you ask my mother and father about my pay, they’d say it was too high – so some people close to me have that view of bankers,” Hester told members of the British parliament, according to The Daily Telegraph of London.
Hester’s contract calls for him to get a bonus of up to 9.6 million pounds ($15.5 million) if he doubles the bank’s share price. His base salary is 1.2 million pounds ($1.95 million) a year. He has also received company stock and other perks.
John McFall, chairman of the treasury committee, said Hester’s pay package made him the highest-compensated public servant in the United Kingdom, and jokingly asked whether the CEO would follow the biblical commandment to “honor thy father and thy mother” by turning down his salary, the Financial Times reported.
Hester’s father is a chemistry professor and his mother is a former doctor of psychology, The Guardian said.
Hester also said Tuesday he was “pleased” with the progress made so far in restructuring the bank. “We did not slip on as many banana skins as I thought we might,” he said.
Perhaps, Abercrombie and Fitch CEO Michael Jeffries took a 39% raise, while their stock price fell 72%, and thousands were laid off. Out of the top S&P 500 companies, there was a CEO salary drop of less than 6% – but compared with wages lost due to unemployment, that’s small pennies. It went from several dozen to several hundred to one, tilted aggressively in the favor of CEOs.
It isn’t exactly a secret that the ratio of the average workers compensation or wages to CEO compensation has widened at a disgusting rate since the late 1960s, and therefore that the average person is likely to get sent running for payday loans.