NatWest has scrapped almost £7.6m in potential payouts to Alison Rose, the banking group’s former chief executive, who was forced to resign over a scandal linked to the closure of Nigel Farage’s bank accounts.
The board of NatWest said that after her resignation, future unvested share awards worth £4.7m would lapse and not be paid out.
In addition, Rose, who was forced to resign in July over a leak to a BBC news journalist about the threatened closure of Nigel Farage’s bank accounts, will not receive a bonus or share-based pay awards for this year worth £2.8m.
“Following the announcement that Ms Rose stepped down from her role by mutual agreement, it has been confirmed that good leaver status is not applicable under the relevant share plan rules,” the company said on Friday. “No finding of misconduct has been made against Ms Rose by NatWest Group.”
The banking group said that the cumulative value of the lapsed unvested share awards, bonus and variable remuneration for this year was £7.58m.
Rose, who received a £5.2m pay package last year, is still expected to receive a pay package of about £2.4m.
This comprises a £1.16m basic salary as well as a fixed share award, benefits and pension payments – but she will be forced to forfeit millions in as yet unvested share awards.
However, under the settlement agreed with Rose, her contract ends in July next year.
This means she is also eligible to receive one more share-based award next April worth £850,000.
In addition, NatWest has agreed to pay a maximum of £546,000 towards Rose’s legal fees and “outplacement support” as she seeks a new job.
“I am pleased that NatWest Group has confirmed that no findings of misconduct have been made against me,” Rose said. “I can also confirm acceptance of the terms of the settlement agreement, which is in line with NatWest Group’s remuneration policy, bringing the matter to a close.”
The taxpayer still owns almost 40% of NatWest, 15 years after it was bailed out by the UK government during the financial crisis.
Earlier this week, the UK’s data watchdog issued a formal apology to Rose, saying it was “incorrect” to suggest she had breached data protection laws by discussing Farage’s banking relationship with a BBC journalist.
The Information Commissioner’s Office appeared to backpedal on findings released last month, which originally suggested Rose had broken rules by confirming the former Ukip leader had accounts with the NatWest-owned private bank Coutts, and misleading a journalist over why it planned to close them.
Last month, an independent review of NatWest’s decision to close Farage’s accounts at its private bank Coutts found that it was lawful.
The report by lawyers hired by the bank determined that Coutts had a “contractual right” to shut Farage’s accounts, and had done so because the bank was losing money by keeping him as a client.
While Coutts also considered that there was a reputational risk of keeping Farage as a customer, it had not discriminated against him, despite raising concerns that his views on issues including migration, race, gender or Brexit did not align with its own, the law firm said.
However, it also identified “serious failings” in its treatment of the former Ukip leader condemning the tone of internal documents obtained by Farage in July, which suggested the bank was concerned about his alleged “xenophobic, chauvinistic and racist views”.
The law firm Travers Smith said that these excerpts, which gave the impression the decision was driven by reputational considerations, were “inappropriate and ill-advised”.
The report was also critical of the fact Farage’s accounts were discussed with the BBC, and that NatWest did not take steps to address the “false impression” circulating in the media regarding his financial affairs.
The report said Rose had made an “an honest mistake” by discussing Farage’s accounts with a BBC journalist and that she mistakenly believed his relationship with the bank was already publicly known.
Travers Smith also confirmed that Rose played no part in the decision to close Farage’s accounts and that she had not seen the internal documents that were eventually released to Farage after a subject access request in July.
In September, NatWest announced that the former Centrica boss Rick Haythornthwaite – who previously chaired Network Rail and Mastercard and leads the boardrooms of Ocado and the AA – would take over from Howard Davies as chair next April.
However, Haythornthwaite is due to join the board in January, four months before the formal handover, to kickstart the search for a new chief executive. The bank is currently led by Paul Thwaite, who was appointed chief executive on 25 July for a 12-month period.
