eFinancialCareers

RBS’s results haven’t been very well received by the market, but they should be pleasing to anyone working for/interested in working for its investment bank.

After the alleged departure of 700 top bankers earlier this year, it seems the bank is now digging deeper to keep hold of the people it likes.

“We know to our cost, having suffered significant resignations of valuable staff members this year, that we cannot ignore competitor pay practices or we will fail as a business,” Stephen Hester reportedly declared today.

True to his word, Hester has increased compensation per head in the banking and markets division to around £100k for the first half, putting it on a par with Barclays Capital.

Headhunters say people in the most successful areas like rates, currencies and flow credit trading are confident of getting a lot more. “Their core platforms are pretty stable and people think they’re going to get paid,” says Lee Thacker at Silvermine Partners.

The bigger issue is apparently paying people in unprofitable areas like structured credit, where risk is being managed down and products are being re-priced.

“They’ve got loads of different types of contract in non-core areas,” says one headhunter. “For example, they’re working out deals which will pay a return at the end of two years.”

Russell Clarke, a director at search firm Mantis Partners, said there’s still a lot of uncertainty at RBS about the actual structure that bonuses will take. “RBS are in a precarious position – they can’t turn around and say this is how you’re going to get paid, particularly before the FSA comes up with its final decision on bonuses.”

Slightly ominously, Hester said clawbacks and deferrals are now standard at RBS. He also said the recent performance of the investment bank was abnormal.