RBS: The taxpayer-funded saga continues

August 14, 2009 1:14 PM

It brings tears to your eyes, doesn't it? Just when taxpayers thought things were looking up for our little involuntary foray into banking, after RBS announced that parts of its business are now in the black earlier this week, they went and did it again.

 

Over the last two days, there have been two RBS stories that evoke the golden era of banking excess. First up was the swanky refurb of RBS's central London offices, which is estimated to have cost between £38 million and £64 million.  Then yesterday news broke that the new Italian-stallion-superstar-banker they had hired had received a £7 million signing bonus.

RBS, predictably, have defended both. They say the office refurb was signed ages ago, and that Mr. Polverino will be worth every penny.

I, predictably, think that's tosh.

These offices have been done out to the highest possible spec, comes complete with swanky tvs, top-of-the-range chairs, desks, lamps and other office equipment and is meant to be (and this is a direct quote from the no-doubt incredibly chic developer) "contemporary and vibrant". I'll give them contemporary and vibrant. The fact that RBS has actively sworn everyone involved in the project to secrecy shows they knew exactly how this would look, and how much anger it would cause. After Fred the Shred  had to parachute himself out of the country to avoid the baying mob, you would have thought they'd have a bit of a rethink on moving into offices which closely resemble Gordon Gekko's wet dream.

On Mr.Polverino - well, this is nothing personal. He looks like a nice enough bloke, and I am (almost) sure that bringing his skill set to the somewhat fetid RBS table will help get the bank back in the black. But £7 million? I know a lot of bankers and this would be an impressive sum even in the headiness of the banking bubble, but now? Now when we have pumped £20 billion into a bank whose profligate ways meant they were going to go under, taking millions of innocent people's money with them.

The bottom line is that when RBS (or the other nationalised and part-nationalised banks for that matter) is back in private ownership, they can do what they want. They can set up shop on the Starship Enterprise and buy their executives gold-plated toilet roll holders. But when every penny their spending has come out of the pockets of taxpayers who are facing uncertain futures themselves, this all makes me feel a bit sick.

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