Monday, 14 February 2011

Undeserved bonuses

Five years ago Rolls Royce had a share price of £4.5 which fell to £ 2.4 but it is now back to £6.60. It has consistently paid a dividend of between 2% & 4%.. By contrast RBS [Royal Bank of Scotland] five years ago had a share price of £6 which during the crash fell to 10p & is now 44p. It hasn't paid a dividend since 2007 & doesn't expect to until 2012. Even HSBC, which avoided the debacle of RBS, had a share price five years ago of £8 which fell to £3 & is now only back to £7 with a dividend of 3%. Which Chief Executive, past and present is worth a seven figure salary plus an obscene bonus? Certainly not the Banks. On the measure of shareholder value so often trotted out as the the principal objective of a business the banks are a miserable failure deserving of nothing.

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