THE new Lloyds Banking Group is set to face the same bonus crackdown that saw Royal Bank of Scotland slash its payouts by 90 per cent, the Prime Minister said today.
Gordon Brown said that the "old excesses" of the banking sector are now coming to an end.
He insisted that those banks that accept taxpayer help will have to impose "the same principles" as RBS.
The Edinburgh-based bank has cut its total bonus
pool from £2.5 billion last year to £175 million this year after a public outcry over its plans to reward staff at the same time as it prepares to post the biggest loss in history for a UK corporate.
Mr Brown will now turn his focus on ensuring that the Lloyds Banking Group, created through the merger of Lloyds TSB and HBOS, will also take a similar "commonsense" approach.
"We will now seek to agree a fair package for staff at Lloyds TSB/HBOS . . . based on the same principles and taking into account its own performance," he said.
Lloyds, which stunned the City last week after warning of £10bn in annual losses at struggling HBOS, has been reported to be considering bonus payouts of up to £120m.
Chancellor Alistair Darling yesterday said the agreed bonuses at RBS were the "absolute legal minimum" the bank was contractually obliged to pay staff.
Within its total bonus pool, RBS will pay £175m in cash to staff, but it said only "legally binding guaranteed bonuses" would be paid.
Any individual who directly contributed to the bank's record losses will miss out, the firm said.
RBS also said that more than 80,000 staff were in line for a pay rise to compensate for it scrapping its profit share scheme.
However, it insisted that the pay rise would mainly be for modestly-paid branch staff who earn less than £19,000 a year and would have been in line for a ten per cent profit share pay-out, which has been paid over the last decade.
There will also be deferred awards, subject to clawback clauses, for staff the bank wants to retain. It was reported today that the deferred award could total £600m, although RBS insists no figure has been put on them.
The deferred awards will be paid in subordinated debt in the form of bonds, rather than shares.
Mr Brown said: "None of these actions is designed to punish or scapegoat City workers. London's role as a great world city is due partly to the dynamism and diversity of its financial workforce.
"I am clear too that bonuses can play an important role in attracting the best talent and in motivating staff, including those on modest incomes."
