António Horta-Osório gets bonus whether or not third of taxpayer’s shares are available for considerably lower than was paid for them – whilst £1.5bn PPI provision drags bank to £570m loss
António Horta-Osório, the boss of Lloyds Banking Group, was about Friday granted a close £1.5m bonus because the government signalled it was prepared to fire the beginning weapon found on the sale of its 39% stake inside the bailed-out bank at a lower cost than expected.
The bonus for the Portuguese-born boss is connected to the government marketing off a 3rd of its stake inside the bank at share costs above 61p – considerably lower than the average cost of 73.6p where the taxpayer injected almost £20bn into the bank inside 2008. The shares shut at 54.47p about Thursday.
He was granted the bonus of £1.48m inside shares inspite of the banking taking another £1.5bn provision for payment security insurance (PPI) compensation, taking its total bill for the mis-selling scandal to £6.7m. This forced the bank to a reduction of £570m for the year. It is paying out a total inside £375m inside bonuses.
Horta-Osório’s bonus is within shares plus is deferred till 2018. The bank mentioned the bonus for the boss “can just vest when a share cost of 73.6p has been reached for a provided time period or the government has available at smallest 33% of its shareholding at costs above 61p”.
“The board believes which these extra conditions are inside the interests of all shareholders plus help the prevalent aim of repaying the taxpayer,” the bank mentioned. “HM Treasury has informed you which 61p is the average cost where the equity help offered to Lloyds Banking Group is recorded inside the public finances.
“This honor are not introduced before the fifth anniversary plus is forfeited when neither of these conditions have been met by which date. Given these conditions, it really is estimated which the expected value of the honor is about £750,000.”
It is not paying a dividend for 2012.
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