The chief executive of bailed-out lender Royal Bank of Scotland has decided to waive a 1 million pound ($1.6 million) share bonus given to him earlier this week, RBS said.

He's waived the bonus, said a spokesman for RBS, which is 83 percent owned by the British government after a state bailout during the 2008 credit crisis.

The bonus award for RBS CEO Stephen Hester had caused a political row in Britain, with many angry at the fact that bankers are still getting large salaries while elsewhere thousands lose their jobs in a weakening global economy.

(Reporting by Sudip Kar-Gupta; Editing by Marguerita Choy)