Gazette News
Stephen Hester: ‘I thought of quitting RBS’
8:44am Thursday 9th February 2012
FORMER Easingwold School head boy Stephen Hester has revealed that he considered quitting Royal Bank of Scotland amid the political storm over his £1 million bonus.
But the chief executive said that in the end, he came to the conclusion it would be “indulgent” for him to resign and it was essential to defuse the “timebomb” of the bank’s balance sheet for the benefit of the taxpayer.
Mr Hester, who was a pupil at the North Yorkshire school for seven years until 1978 and returned there in 2010 to take part in its annual senior prize-giving ceremony, admitted he had “underestimated” the furore the bonus would cause and eventually decided to waive it because of the damage the row was doing to the bank.
“I took the judgment that it was going to be damaging for RBS to stay in the intensity of the spotlight that we had got into,” he said, speaking on BBC Radio 4’s Today programme.
He said he had “great sympathy and understanding” for people concerned about the high rewards in the banking industry, but such “societal issues” were ultimately a matter for politicians.
He said it was essential that RBS was able to recruit the best people to resolve the problems it had inherited from the former management, which led to it being bailed out by the taxpayer.
He admitted the banks had been guilty of “hubris” after 20 years of “unbridled expansion”.
He said the continuing controversies over RBS since its rescue by the taxpayer three years ago had taken their toll on him personally.
“I am certainly not a robot and there have been some deeply depressing moments,” he said.
He warned it was important not to “demonise” a sector which remained essential to the economy. “Let’s not demonise a whole industry,” he said. “Let’s not demonise something that is fundamental to the world economy. Banking is important, financial services is important. It supports the economy, it supports millions of jobs and we need to remember that.”