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Home Economic Fundamentals UK Economic Lloyds Banking Group will feel heat over Daniels bonus
Lloyds Banking Group will feel heat over Daniels bonus PDF Print E-mail
UK Economic
Written by Sam Coventry   
Monday, 22 February 2010 10:34
Financial news headlines this morning: Lloyds Banking Group, RBS, 50p tax rate, Xstrata and JPMorgan Chase.


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Lloyds Banking Group (LON:LLOY) may be forced to announce that its Chief Executive, Eric Daniels, will give up his bonus after the head of rival RBS (LON:RBS) rejected a £1.6m reward.

Daniels is entitled to a maximum bonus of £2.25m for 2009.

However, accepting any sum would put the Lloyds banker in an uncomfortable position after Stephen Hester, RBS’s chief executive, became the third major banking figure in six days to forgo lucrative awards, the Times reports.

Last week the bosses at Barclays announced they would forgo bonuses.

The forfeiture of bonuses by bank bosses will be an attempt to avoid further media and public scrutiny, especially considering the two state backed banks are widely expected to announce further losses later this week.

Analysts expect Royal Bank of Scotland (RBS) – which reports on Thursday – to unveil pre-tax losses of £5.1bn for 2009, against £8.3bn the previous year.

Lloyds Banking Group will report a small profit, largely thanks to accounting quirks.

However, its "underlying" loss could come in at as much as £13bn. Lloyds Banking said the question ofDaniels' bonus was "a matter for our remuneration committee,” adds the Independent.

50p tax rate looms


A last-minute rush to accelerate the payment of bonuses ahead of April’s introduction of the 50p tax rate for high earners is under way, amid mounting anger by top executives over the squeeze on their take-home pay.

Advisers said there had been a surge in interest since new year from businesses wanting to shift the timing of payments or introduce tax-efficient plans to avoid the new top tax rate, the FT reports.

Xstrata


Glencore, the Swiss commodities trader, is sounding out potential partners as it prepares to buy back the $2.5bn Prodeco coalmine owned by Xstrata, The Times has learnt.

The Swiss trading group is understood to be discussing a possible deal with Vale, the Brazilian miner, and GIC, the Singaporean sovereign wealth fund.

It is also believed to have held talks with First Reserve, a US-based investment fund, and Alpha Natural Resources, an American coal producer.

JPMorgan Chase


Canary Wharf’s hopes of taking the crown as London’s main financial centre have suffered a new blow as it emerged that JP Morgan is scouting for office locations back in the City.

The US investment bank is considering backing out of its £1.5 billion European headquarters development in Canary Wharf and is understood to be looking at other development sites and existing office buildings, as it reviews its plans for its HQ, the Times reports.
Last Updated ( Monday, 22 February 2010 10:37 )