NatWest Group, which is mostly owned by British taxpayers, has decided to cancel most of the potential £10m-plus payout to its former chief executive, Dame Alison Rose. This move comes as the bank tries to put an end to the debanking controversy that arose after the closure of Nigel Farage’s Coutts accounts. The NatWest board’s decision is expected to be announced to the London Stock Exchange soon, relinquishing Dame Alison of her unvested share awards, but she will still likely receive a significant sum in the form of her basic salary and fixed share allowance.
In a significant and long-awaited decision, the board of NatWest Group has resolved not to pay most of the discretionary components of Dame Alison Rose’s pay package. Although precise numbers are yet to be disclosed, it was anticipated that NatWest would adopt a firm stance towards its former chief executive, who stepped down in late July after admitting to discussing Nigel Farage’s banking arrangements with a BBC journalist. This decision implies that Dame Alison will miss out on millions of pounds in unvested share awards while probably receiving a seven-figure sum consisting of her basic salary and fixed share allowance.
Dame Alison’s contract, which encompassed a 12-month notice period, stated that she would receive an annual salary of £1.16m, in addition to a further sum of the same amount as deferred share awards. It is expected that the bank will cover her legal fees. As the CEO, Dame Alison had amassed unvested share awards worth approximately £5m, most of which were granted during her tenure as chief executive beginning in 2019.
The debanking of Nigel Farage by NatWest caused a major uproar in the political landscape, resulting in the Information Commissioner’s Office issuing a formal apology to Dame Alison. This apology, however, prompted a furious response from Mr. Farage. The closure of Mr. Farage’s accounts unveiled a number of derogatory comments made by NatWest employees regarding his views and finances. The incident led to NatWest apologizing to Farage and a subsequent review of debanking practices across the banking sector.
According to a public filing by NatWest, Dame Alison has been receiving an annual package of £2.4m since her departure at the end of July. This package comprises her base salary, pension contribution, and a share-based fixed-pay allowance. In addition, she was eligible for a pro-rata portion of the £2.9m annual bonus and long-term share awards, making up her total maximum pay package of £5.3m. Furthermore, she held around 2.5 million unvested shares in NatWest, which were valued at £5m as of Thursday’s closing share price.
Dame Alison’s exit package is yet to be disclosed, and it is unclear whether the Treasury has given consent to the terms of the package. Her departure from the bank was deemed a mutual agreement after she inaccurately briefed a BBC journalist on the reasons for closing Mr. Farage’s accounts. Subsequently, it was revealed that his political views played a significant role in the bank’s decision. Dame Alison’s leadership was put into question after signals from Downing Street suggested a lack of confidence. This led to an emergency board meeting being called to approve her departure.
NatWest Group’s decision to forgo the majority of Dame Alison Rose’s payout demonstrates the bank’s attempt to put an end to the debanking controversy surrounding Nigel Farage’s accounts. Despite losing her unvested share awards, Dame Alison is still expected to receive a substantial sum from her basic salary and fixed share allowance. The cancellation of the discretionary elements of her pay package has brought some closure to this high-profile issue, which resulted in public apologies, a review of debanking practices, and the reshuffling of leadership at NatWest Group.
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