"Fish's pension under scrutiny in London" by Ross Kerber, Globe Staff | March 10, 2009
Former Citizens Bank chief executive Lawrence K. Fish will draw a pension of $2.2 million a year, its British parent reported in a filing yesterday, adding fuel to a fire building in London over payouts to financial executives.
Call it a "reward" for managing the bank to bankruptcy.
Fish, the architect of Citizens' growth into one of the country's biggest regional banks, stepped down from its board earlier this year. Both Citizens and parent Royal Bank of Scotland Group are in retreat after suffering steep losses due to bad loans and overexpansion. Like the US government, British officials had to bail out banks, including RBS which is now largely owned by the government.
Most of Fish's pension had been disclosed in previous filings and is on par with that of his US peers, according to compensation experts. But RBS's annual report this year comes as the British government investigates whether to "claw back" or take some of the $958,000-a-year pension being paid to Sir Fred Goodwin, 50, the RBS chief executive ousted last fall.
Now Fish, 64, is coming under fire as well, showing the complex relation ship between the British bank and its American arm.
"Exposed: The RBS Director with the 1.6 million (pound) pension," read a headline yesterday on the website of London's Evening Standard newspaper, which called Fish's pension "the largest received by a company employee in British corporate history." Also, a recent article in London's Sunday Times titled "Greedy bankers still coining it in at our expense" cited prominently Goodwin's and Fish's pensions.
Fish and an RBS spokeswoman both declined to comment yesterday. US pay experts, however, said Fish's pay is in line with his peers among US bankers, and the controversy in part highlights the different pay standards that have emerged on opposite sides of the Atlantic.
"This won't raise eyebrows here," said Frank Glassner, chief executive of San Francisco pay consultant Veritas ECC, whose clients include large banks and financial firms....
Maybe not to you, elite scumbag, but it WILL RAISE the IRON BLADE in SOME QUARTERS!!!! Hey, the fish rots from the head so CUT IT OFF!!!!!!!!!!!!!!!
Citizens Bank is part of Citizens Financial Group in Providence, which reported a $929 million loss last year and took a write-off of $1.5 billion tied to its purchase of Charter One, a Midwestern banking chain bought for $10 billion in 2004. But those losses paled in comparison to the rest of RBS. Hamstrung by poor loans and faulty acquisitions, RBS reported a $34 billion loss last month, the largest in British corporate history. Still, Citizens is healthier than some competitors as judged by its capital ratios and other measures, and got a shot of confidence when Goodwin's replacement, Stephen Hester, said he wouldn't sell Citizens but rather have its current US executive team decide where to cut costs.
Antony Broadbent, an independent London banking analyst, said Fish is not a "credible scapegoat" for British politicians angry over the bankers' pay. With Goodwin, the politicians "have got their man. They don't need another," Broadbent added.
Yesterday's filing showed Fish will receive $2.24 million a year, including $157,000 for his work in 2008, benefits with a total "transfer value" of $27 million, or the total cost of the liability to the banks' pension system. Just 2 percent of it was fully funded, the filing stated, meaning the bank could have to pay for the rest.
And since the BANK is OWNED by TAXPAYERS NOW, guess who is getting STUCK with the TAB?!!!!
As for whether Goodwin - or Fish, for that matter - risk losing their pensions, one professor doesn't think it can happen. "These pension benefits are being given to them under a prior contract," said Fred Foulkes, director of the Human Resources Policy Institute at the Boston University School of Management. "It's difficult to change a contract."
Efforts to change executive pensions in the United States typically rely on proof of malfeasance or violation of a noncompete clause, he said. "Larry Fish for years was a hero. He did a great job," Foulkes said. "If he was a substantial shareholder, he probably lost a lot of money and his net worth has probably gone down quite a bit. I'd be incredibly surprised if the company took action against him."
Sadly, so would I.