HSBC fuels bank row with million pound bonuses

Have your say

HSBC, Europe’s biggest bank, paid out bonuses worth over £1m to more than 200 bankers last year, causing an angry backlash from unions and the anti-banking lobby.

The bank, which reported annual pre-tax profits of £13.6bn, also gave its chief executive Stuart Gulliver a pay package worth more than £8m.

HSBC said staff bonuses rose six per cent to £2.3bn last year.

The increase comes despite pressure on banks to rein in big bonuses that have been blamed for fuelling the risk-taking that led to the 2008 financial crisis.

TUC general secretary Frances O’Grady said the results were “yet another example of soar-away boardroom greed”.

“It would be great if banks put the same effort into lending to small businesses and investing in infrastructure as they do to getting round EU rules on boardroom bonuses.”

This followed HSBC’s admission that it has created measures that will help it to sidestep new EU rules on bank bonuses by offering senior staff fixed pay allowances.

Mr Gulliver said the bank plans to pay more than 600 of its top staff a new quarterly allowance, effectively increasing the amount of their fixed pay to meet new EU laws that cap bonuses at 200 per cent of salary.

Mr Gulliver will see his base salary stay at £1.25m and he will receive a fixed pay allowance of £1.7m, to be awarded in shares on a quarterly basis.

Unite national officer Dominic Hook said: “In the last year thousands of staff have been told their final salary pension scheme will be closing, giving savings for HSBC that are a drop in the ocean compared to these enormous profits.

“The news that hundreds of senior staff at the bank were paid massive salaries topping £1 and more will be hugely frustrating for staff working in call centres and branches up and down the country, who are working hard, often under great pressure to perform.”

HSBC said it has no plans to spin off and separately list its UK retail banking arm to meet new regulatory requirements.

HSBC’s Leeds-based internet bank First Direct reported a five per cent increase in its mortgage balances to £19.95bn.

John Foley of PTSG

PTSG’s results are set to be in line with board’s expectations