RBS faces storm over pay plan for bosses

ROYAL Bank of Scotland faces an angry AGM on Wednesday as the bank comes under pressure to give more details of a controversial pay plan for its top US executives.

John Saunders, chairman of the Local Authority Pension Fund Forum, has challenged RBS chairman Sir George Mathewson to review the policy, saying it is 'excessive' and 'does not represent pay for performance'.

The letter, seen by Financial Mail, continues: 'Transparency in company remuneration disclosures is vitally important and if these details are kept secret until legally required to be made public, this may undermine the longer term interests of the RBS group, potentially inciting a backlash from shareholders, employees and customers.

'Shareholders are being asked to approve a new scheme on trust without sufficient details of the targets or potential award and without knowing what the previous scheme delivered to participants-We believe this to be unacceptable.'

His comments echo those of shareholder advisory group PIRC, which is urging its local authority pension fund clients to vote against the RBS pay report at the AGM.

Larry Fish, head of RBS's American operations, earned £2.3m last year but could scoop more under a new incentive scheme.

Mathewson once dismissed criticism of his own £2m package, claiming that it 'wouldn't buy him bragging rights in a Soho wine bar'.