At a general meeting in Edinburgh this morning, shareholders met to vote on final proposals for RBS’ entry into the Government’s APS. Almost all shareholders voted in favour of entry in the scheme, which will see the state take an 84 per cent interest in the bank.
In particular, shareholders voted in favour of the RBS 2010 Deferral Plan which will allows the Government to have control of the size of the bank’s bonus pool. This comes after reports suggested that RBS directors threatened to walkout if the state took control of bonus remuneration.
Chariman Sir Philip Hampton strong denied the reports. He told shareholders: “I should also like to make it clear that, contrary to a number of media reports, there have been no threatened mass resignations of the board, at any time. The board is wholly committed to its duties.”
The APS will now cover a £282bn pool of assets, half of which are foreign debts. If losses on this pool were to exceed £60bn, the Treasury would bear 90 per cent of any subsequent losses, while 10 per cent would remain with RBS.
RBS says it is confident that the first £60bn will not be exceeded and thus the bank will never have to use the scheme.
In lieu of receiving Government aid, RBS has agreed with the EU Commission to sell chunks of its business, including its insurance arm and parts of its retail bank.
Hampton adds: “The group’s inherent strengths remain intact and the divestment proceeds will help our capital position, and that could bring forward the prospect of exit from the APS.”