RBS chief calls bonus row 'discomforting'

Stephen Hester, the chief executive of Britain's state-rescued Royal Bank of Scotland, has said the row over his bonus had been "personalised" and "discomforting to say the least". Hester made his first comments on the furore in a memo to RBS employees, having bowed to intense political pressure last month and waived his annual bonus of shares worth £963,000 ($1.5 million, 1.15 million euros) on top of his £1.2 million salary. He said he did not know how much "damage" had been done to the bank, but added: "The best way to deal with it is to prove the critics wrong." Former RBS chief executive Fred Goodwin was also stripped of his knighthood last month. "I am acutely conscious that the way our company has been in the media and political spotlight this last 10 days is discomforting to say the least," Hester wrote. "And while it has been personalised in different ways, whether on myself or my predecessor, many have felt a broader impact on RBS of the uncertainty and criticism." The huge bonus -- following government calls for pay restraint amid ongoing austerity and economic gloom -- sparked outrage among trade unions and the opposition Labour Party because RBS is 82-percent state-owned following a huge bailout. The government welcomed Hester's decision to spurn the payment, which was proving a major embarrassment for the Conservative-Liberal Democrat coalition that has pledged to crack down on excessive boardroom pay. Hester said that while the bank could not control the economic or political environment, it had proved over the last three years that it could "overcome great obstacles". "There is no doubt that our position in the spotlight makes the job harder," he wrote. "And we can't know how much damage that will do to RBS or the interests of those we serve, whether as customers or shareholders. But the best way to deal with it is to prove the critics wrong." He thanked staff who had sent him messages of support, saying it was "much appreciated".