Royal Bank of Scotland (RBS) investment banking head John Hourican is to quit as the banks’ £390 million fine for Libor fixing is set to be announced today, according to reports.
According to Sky News, Hourican will relinquish around £4 million of share options awarded based on past performance, and receive a year’s salary of around £700,000. It said the departure would follow political pressure for a prominent scalp from the bank following its involvement in the Libor scandal.
Hourican’s departure comes as the bank prepares to announce a settlement with regulators over its involvement in the global Libor-rigging scandal.
According to the Financial Times, the fine will total £390 million, including around £90 million from the Financial Services Authority, $150 million (£96 million) from the US Department of Justice and $325 million from the US Commodity Futures Trading Commission.
Sky said Hourican’s role was being made redundant by a restructuring of the investment banking division, and he was leaving despite regulators and the bank acknowledging he had no knowledge or involvement in Libor rigging.
RBS is expected to recoup the £300 million in US fines from investment banker bonuses. Business secretary Vince Cable will also today revive plans to privatise the bank by distributing free shares to the public, according to the FT.
Cable will argue the government should launch a giveaway of RBS securities that will allow voters to share in the upside of the bank’s share price above a predefined floor.