GUEST COMMENT: Does RBS really still exist?!
Believe it or not, rumours are that RBS bonuses are being announced this week. This begs the question, is somebody really getting paid there? Who is even left?!
Most good people are gone already
These chaps were obviously ahead of the game at RBS. They sussed out things would only go from bad to worse and they left in a hurry. As this is being written, I am pretty damn sure that even now, some RBS employee somewhere is signing a contract for another firm eagerly trying to get out of the nightmare that they probably still cannot believe they ended up in.
Various individuals and teams have been poached in the past 24 months. A number of the sector bankers inherited from ABN AMRO have departed. Not only are rain-makers (notably in London, Fiona Paulus to Société Générale and the emerging markets M&A team to Barcap) leaving, so are the all important juniors and graduate trainees.
Fresh out of the ABN/RBS graduate programme, many have ended up in better positioned banks, specialised consultancies, private equity and corporate business development.
Are they real(ly) bankers hanging in there?
So - whos left in this wonderful white elephant of an institution who can expect a bonus? They can be split into three main groups;
1. Those that are searching actively - these are the guys who keep taking hushed calls with headhunters in the office. Why would they stay and work all hours of the day and night and not get paid a decent banking wage for their efforts? As soon as they find something, they are off - with or without a meagre bonus number!
2. Imposters pretending to be bankers - these are the guys that just aren't good enough to be taken by anybody else. RBS appears full of them. They have tried to get out but no other institution wants them. They are merely the bottom 10% of the banking league and need to be relegated to accountants or some other bean-counting job. Any extra money or shares will be accepted
3. Those living in the clouds - yes! Believe it or not, there are bankers there who (or at least appear to) genuinely believe the hogwash they are being sold - that one day RBS will be the powerhouse it was. Though, they could be the ones with the last laugh - these bankers tend to be senior, have guarantees, or other benefits tied to their positions, so they actually do have an incentive to stay. They already know their bonus figures.
Some home truths for Stephen Hester et al. in the run up to bonus decisions
We all know that the guys at the top are there because of various guarantees and promises - please stop treating your junior employees and other bankers as if they don't know this too. We realise you also believe (just like your parents do) that you are overpaid. We all know. Stop the hogwash.
Having difficulty hiring new bankers? Instead of trying to hire new people, RBS needs to understand why people are leaving in the first place. Reinserting new blood into a dead body will not bring the body back to life, nor will new employees necessarily be able to rescue RBS or its reputation.
RBS doesn't appear to be raising salaries for anybody in Investment Banking.
If RBS doesn't pay its staff at least a fair value bonus for the income they have generated over the past 12 months for the bank, they risk losing many more staff.
A simple message to RBS - act like a retail bank, stick to retail banking.
The author is a person with personal knowledge of RBS. The opinions expressed above are entirely his/her own.
