NatWest has been told by City minister Andrew Griffith to be “mindful” of public opinion as it weighs whether to reduce up to £10 million of potential pay for its former boss Dame Alison Rose.
His intervention comes as the bank’s board decides if her admission that she discussed the bank account of former Ukip leader Nigel Farage with a BBC journalist is grounds to reduce her pay.
Following the results of two reports on her actions published last week, Farage demanded she be stripped of her pay, piling pressure on the board from parts of the media and Westminster to heed his demands.
Sir Howard Davies, the bank’s chairman, said on Friday that the board had “to consider where we go next on remuneration” after publishing a report it had commissioned from Travers Smith on the events that led to Farage having his account closed by Coutts, NatWest’s private bank.
In findings dismissed by Farage as a “whitewash,” the law firm concluded that Rose had made an “honest mistake” in discussing the account, as she had believed this information was already in the public domain.
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The firm said the disclosure was probably a “personal data breach” but one that the Information Commissioner — which oversees data law — did not consider formally notifiable.
Travers Smith said NatWest had a “contractual right” to close Farage’s account, which was not profitable, but that it had committed “serious failings” in the way it did so. Bank staff had described Farage as having “xenophobic, chauvinistic and racist views”, though the firm concluded his account had primarily been closed for commercial reasons.
A government source said Griffith had reminded the board that it should be mindful of the strength of public and parliamentary concern about the situation. He is also said to have made it clear that the conclusion by Travers Smith — that the account closure was lawful — would need to be backed by regulators. The Financial Conduct Authority has said it found “potential regulatory breaches” in the handling of Farage’s account.
The Travers report will be part of the material used by the bank’s remuneration committee, chaired by Lena Wilson, a former chief executive of Scottish Enterprise, to decide on her remuneration.
Rose, 53, receives her pay in three main blocks. Her “fixed pay” — in essence, her salary — of £2.2 million is paid half in cash and half in shares. The bank has said she is receiving this in its entirety in accordance with her “contractual arrangement” while she is employed under 12 months’ notice. The second part is an annual bonus of up to £2.9 million, which is based on her achieving certain performance criteria. In July, the bank made it clear this was already being reviewed.
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The third part is the 2.5 million shares she has been awarded in previous years but cannot yet receive. These awards are worth about £4.7 million after Friday’s share price drop to 187p.
One of the considerations is whether Rose is classified as a “good leaver” and able to continue to receive her “unvested” share awards. Earlier this month, Barclays announced it would not allow its former chief executive Jes Staley to keep his previous share-based bonuses — worth about £17 million — after regulators concluded he had misled the bank’s board over his relationship with Jeffrey Epstein. Staley is contesting the regulators’ decision.
Rose is now thought to be in discussion with lawyers at Mischcon de Reya about the situation and would not comment this weekend.
But on Friday, she said: “Travers Smith is clear that there was no leak of specific detailed financial information,” she said.
She has also shown she is ready to fight to restore some of her trashed reputation. After the Information Commissioner’s Office declared last Wednesday that she had breached data protection laws, late on Friday it issued a statement admitting it had not given her a chance to comment on her actions in the affair. “We will be reviewing this as a matter of urgency,” the ICO said.”
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The decision over Rose’s pay is expected by the time of the annual report next year.
