Lloyds boss to pick up £2m bonus


Britain Banks

The boss of state-backed Lloyds Banking Group has won a long-term bonus worth more than £2 million after a strong share price performance qualified him for the windfall.

Antonio Horta-Osorio will receive three million shares in the company after the stock closed above 73.6p for 30 days in a row.

Their price at the end of trading was 75p, meaning the bonus currently has a paper value of over £2.2 million, though Mr Horta-Osorio will not be able to sell the shares until 2018.

A Lloyds spokesman said: "Antonio's bonus reflects the significant turnaround at Lloyds under his leadership - something that has enabled taxpayers to start getting back their money at a profit."

The incentive scheme has fuelled anger among unions. The chief executive has qualified for it two weeks after Lloyds announced plans to stop annual pension rises for the 35,000 employees still belonging to its final salary pension scheme.

The stock came perilously close to falling below target earlier this month, closing at 73.9p on November 7, but has since climbed.

Lloyds Banking Group, rescued by the taxpayer during the financial crisis after swallowing up Halifax Bank of Scotland, remains 33% state-owned.

It notched up losses of £440 million in the third quarter of this year and its bill for the payment protection insurance mis-selling scandal soared to more than £8 billion, but underlying profits nearly doubled to £1.52 billion for the period.

Shares have been buoyant over the past year as Lloyds looks to emerge from a turbulent period. They recently nudged above 80p and are worth twice as much as they were just over a year ago.

The bonus scheme was devised in March when the shares were worth just 50p. The 73.6p level represents the average price paid by the taxpayer when the bank was rescued.

Mr Horta-Osorio would also have qualified for the scheme should the Government sell at least a third of its shareholding in the group, at more than 61p per share.

But following the Treasury's disposal of 15% of its holding - or 6% of the group - in September, the Chancellor pledged no more would be sold for 90 days.

It meant that the share price criteria for the chief executive's bonus was on course to be met first.

Details of the bonus have been criticised by trade union Unite, describing the shares scheme as "massive awards for the bosses while ordinary bank workers struggle to pay their household bills".