Here\’s the bit that people aren\’t concentrating on:
Hester insisted RBS needed to pay bonuses to its investment bankers – who generated £5.7bn of an £8.3bn underlying profit
Yes, the bank as a whole made a loss. But the investment bankers seem to have made a very good profit. The losses came from the previous actions of commercial bankers, not investment bankers.
Paying the people making a good profit well doesn\’t seem, on the face of it, to be a bad business decision really.
In fact, from my limited knowledge of it, RBS\’ problems didn\’t come from its investment bankers at all. A combination of bad loans and hugely overpaying for expansion in taking over ABN Amro were the problems.
Quite why, if investment bankers didn\’t cause the problem investment bankers should get it in the neck I\’m not sure.