RBS boss Hester could pocket £8 million bonus in future

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In Britain, the salaries at RBS and Lloyds are particularly controversial since both banks were bailed out with 66 billion pounds of taxpayers' money during the crisis. As well as its RBS stake the government owns 40 percent of Lloyds.

BOARDROOM PAY

RBS halved Hester's stock bonus for 2011 to just under 1 million pounds from 2 million in 2010. It resisted calls to axe Hester's bonus altogether, although it waived a 1.4 million pound bonus for its chairman Philip Hampton.

Senior opposition Labour politician Liam Byrne reiterated calls on Sunday for Prime Minister David Cameron to intervene over Hester's bonus.

"This is a bank that the government owns almost all of, the government is the biggest shareholder. Mr Cameron has been talking about how shareholders need to flex their muscles and have a bigger say in the way that executive pay is set," Byrne told Sky News.

"Fine - let's keep you to your word, step in now and say that this bonus payment to Mr Hester is wrong and should be stopped," he added.

However, cabinet minister Iain Duncan Smith said intervention would be difficult, adding that the RBS pay contracts had been set under the previous Labour government.

"You can't interfere and tell them what to do. And if we did not like that, the only option would be to get rid of the board. If you do that, imagine what would happen in the banking sector, and imagine what would happen to RBS. You would have chaos," he told the BBC.

Duncan Smith also reiterated Cameron's stance that it was up to Hester to decide if taking the bonus was appropriate or not.