When it comes to telling employees to take a long lunch and not come back. Read more »
Once, in 2007, the people who ran RBS though it would be a good idea to buy a Dutch bank with lots and lots of toxic assets. It proved to be not so good an idea, so RBS needed to raise some cash. So it sold £12 billion worth of new stock in June 2008.
In the face of a £28 billion net loss it announced a few months later, that fresh capital evaporated rather quickly, forcing a new share sale to Her Majesty’s Treasury. The people who bought those £12 billion in shares, unsurprisingly, aren’t thrilled about what happened to the value of those shares before and after nationalization. So 12,000+ are suing, seeking several billion pounds from Fred Goodwin & Co., which makes the loss of his knighthood seem rather a bargain. Read more »
The bank, which is 82 percent owned by British taxpayers, said its fourth quarter losses increased 44 percent from a year earlier, to 2.60 billion pounds. That led to a full-year loss of 5.97 billion pounds ($9 billion), up from a shortfall of 2 billion pounds in 2011…RBS suggested that when investors take into account the one-time costs — such as paying the LIBOR fine — the bank is in much better shape than it might look. Operating profit, a measure of earnings before tax and one-time charges, rose to 3.46 billion pounds last year from 1.82 billion pounds. “I think we are coming really closer to the point where we are a normal company again,” Hester told the BBC. [NYP]
Bonus Watch ’13: RBS’s Chairman Doesn’t Give A Baker’s Fuck If Parliament Thinks His CEO Is OverpaidBy Bess Levin
Philip Hampton isn’t going to go so far as to say Stephen Hester earned it but he is going to just put it out there that other bank CEOs get paid a lot more. So if you think about it, Hester is barely making enough money to put food on the table. Relatively speaking. Read more »
Royal Bank of Scotland Group Plc executives told lawmakers they believed it was impossible to rig Libor, less than a week after regulators found traders at the lender manipulated the benchmark for more than four years. “None of us thought of this as a risk that needed this level of attention,” said John Hourican, who resigned as investment-banking head after the fine, told a hearing of the Parliamentary Commission on Banking Standards in London today. “It just didn’t occur to anyone that it could be fiddled,” former investment banking chairman Johnny Cameron told lawmakers. [RBS]
Citigroup executives wooed him in June 2009 at a swanky bar in Tokyo. As they showered him with praise, say people who were there, Mr. Hayes rarely spoke, instead letting his girlfriend, a lawyer, answer questions.
Shady traders: date lawyers! And let them do all the talking for you.
That detail is from this amazing Wall Street Journal article about Hayes. When we last discussed Hayes and his totally open and casual requests to people he’d just met to manipulate Libor for him, I asked “is this: (1) all of these people did not fully realize that they weren’t supposed to be doing what they were doing, (2) UBS’s culture was one of complete lawlessness and fuck-around-ery, or (3) both of those things are true and reinforce each other?,” and per the Journal the answer is fascinatingly (3).
I’ve occasionally said that Hayes made a career of Libor manipulating but that’s not entirely right. He started at RBS and, per the Journal‘s account,1 spent his time there mainly being smart and dressing “like a college student — with washed out jeans, a polo shirt and sometimes a threadbare sweater” rather than IMing people to ask them to fix Libor. (That, at RBS, seems to have come later.) Then he moved to UBS: Read more »