The Group announced on 22 March 2018 that its proposed Ring-Fencing Scheme had been sanctioned by the Court of Session in Scotland and has been effective since this date.
As previously announced, under the scheme, the Bank will transfer its UK retail & commercial banking business to Adam & Company PLC (Adam); transfer its covered bonds in issue and Mentor business to National Westminster Bank Plc (NatWest); and transfer branches and other properties to either NatWest or Adam. Please see the attached report for further details.
The Bank continues to face litigation related to residential mortgage backed securities, LIBOR, treatment of SMEs, money laundering, payment protection insurance, and disputed taxes. Please see the attached report for further details.
Item 2: Approve the Remuneration Report
The structure is unacceptable given the use of the fixed share allowance and the excessive pension contributions. The quantum is excessive given the high levels of fixed pay. We recommend shareholders oppose.
Item 22: To approve a general authority to the directors to issue equity convertible notes and to replace securities that will not be eligible as regulatory capital in 2019, we believe that a dilution rate of up to 12.41% of share capital is simply excessive. We continue to believe that a rights offering to shareholders which would increase the CET 1 ratio is the best way for a bank to meet its capital requirements.
Item 28: To request that the Board establish a Shareholder CommitteeThis is a shareholder proposal submitted by ShareSoc, The UK Individual Shareholders Society, and UKSA, The UK Shareholder's Association. The shareholders propose that the Board establish a shareholder committee in order to facilitate more effective oversight by shareholders of the governance of the Company.
The Board recommends shareholders vote against the proposal. In their view, it might be hard to have members on the committee that would represent the views of all shareholders and the existence of the committee might "blur the lines between stewardship and executive decision-making and undermine the unitary board model."
They feel that the Board already engages with shareholders and other stakeholders and the appointment of such a committee would not be in the interest of all shareholders.
ECGS recommends support for the initiative by shareholders to have a formal, structured forum for ongoing engagement with the Board as well as their intentions to be more involved with key governance issues such as nomination, remuneration and auditing. We also consider that the proposal to provide a forum for all shareholders, reporting to all shareholders of the committee's activities and voting advice would offset some of the concerns about the benefit of the committee to all shareholders rather than just a small group.
This proposal was also made at the Companyns 2018 AGM, and received a level of 1.35% support from shareholders. Given that there is a controlling shareholder, the requisitionists consider this a remarkable result. They note that change does not occur immediately.
Royal Bank of Scotland Group is a banking and financial services company. Co.'s activities are organized in franchise basis; Personal and Business Banking (PBB) comprising UK PBB and Ulster Bank RoI segment, which serve individuals and small businesses in the U.K. and the Republic of Ireland; Commercial & Private Banking comprising, Commercial Banking and Private Banking segment, which serve commercial, corporate and private banking in the U.K. and Western Europe; RBS International, which serves retail, commercial and financial institution in Jersey, Luxembourg and London; and NatWest Markets, which provides risk management and financing solutions through its trading and sales operations.
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RBS reported first-quarter 2019 operating profit before tax of GBP 1 billion compared with GBP 1.2 billion the same period a year ago. Lower operating expenses, down nearly 4% year over year, were not enough to offset weaker income generation. Net interest income declined 5% to GBP 2 billion, mostly driven by NatWest markets and personal banking. Excluding one-off items in these segments, generally higher economic uncertainty and continuously high competition in the mortgage market could be seen as the underlying factors driving this performance. The Brexit delays and accompanying business unc...
While there are signs of green shoots in Royal Bank of Scotland's revenue generation, challenges regarding litigation and restructuring costs, as well as revenue generation, remain to be dealt with in the short term. RBS posted 2018 full-year annual net income of GBP 1.6 billion versus GBP 752 million in 2017. While operationally somewhat better than the previous year, significantly lower restructuring costs were the biggest supportive factor in 2018. Although it is rather slower than peers, it seems RBS' management has found a good path to resolve outstanding issues and to operationally catch...
RBS reported first-quarter 2019 operating profit before tax of GBP 1 billion compared with GBP 1.2 billion the same period a year ago. Lower operating expenses, down nearly 4% year over year, were not enough to offset weaker income generation. Net interest income declined 5% to GBP 2 billion, mostly driven by NatWest markets and personal banking. Excluding one-off items in these segments, generally higher economic uncertainty and continuously high competition in the mortgage market could be seen...
Le renouvellement des mandats de Philippe Maubert, Christophe Maubert, Catherine Canovas, et Lionel Picolet sont soumis à l’approbation des actionnaires. Au regard du manque d’indépendance au conseil d’administration, Proxinvest s’opposera aux résolutions 5 à 8. La politique de rémunération pour 2019 présentée par la société dans le Rapport de Gouvernance d’entreprise est très insuffisante. L’absence de nombreuses informations ne permet pas à l’actionnaire d’estimer la rémunération attribuable aux dirigeants pour 2019. Ainsi, Proxinvest s’opposera à la résolution 9. Concernant la rémunératio...
GouvernanceLa société propose le renouvellement de 3 administrateurs et la nomination de 2 administrateurs indépendants. Parmi les renouvellements proposés figure celui de Julie Guerrand. Selon la politique de vote de Proxinvest, en cas de conseil ne comprenant pas une majorité de membres indépendants, Proxinvest soutient 1 représentant pour chacun des 3 principaux actionnaires. En l'occurrence, le représentant le plus légitime de H51, le premier actionnaire, est sa Présidente, Julie Guerrand. Nous soutenons donc son renouvellement, mais pas celui de M. Bauer. Concernant Mme Sénéquier, bien qu...
Le conseil n'est pas majoritairement composé de membres libres de conflits d'intérêts. Par conséquent, parmi les renouvellements proposés, seul le Président du conseil sera soutenu en raison de la séparation des fonctions avec la Direction Générale (résolutions 5 à 7). En ce qui concerne la rémunération 2018 du Directeur Général, l'absence de communication des taux de réalisation de chacun des critères financiers du bonus constitue un manque rédhibitoire pour Proxinvest. Par ailleurs, l'attribution d'actions gratuites est basée sur des critères non vérifiables et qui sont calculés sur une pér...
ITEM 10: Although the board does not comprise a majority of independent members, Julie Guerrand is the most legitimate representative of the main shareholder as she is its Chairman. Thus, we recommend approval. ITEMS 7 and 8: Axel Dumas’ additional remuneration is indexed to the Group’s revenue, but only in an upward direction. If the company underperforms, executive will not be impacted. This is not acceptable. Moreover, Emile Hermès SARL’s total remuneration reached €9.6 M in 2018, which widely exceeds the median CAC 40 executives and represents 458 times the French minimum wage (SMIC), wh...
The majority of the Board is not composed of independent members. Consequently, among the proposed renewals, only the Chairman of the Board will be supported due to the separation of functions with the Executive Management (resolutions 5 to 7). With regard to the 2018 remuneration of the CEO, the failure to communicate the achievement rates of each of the financial criteria related to the bonus constitutes a fundamental flaw for ECGS. In addition, the allocation of performance shares is based on criteria that cannot be verified and are calculated over a period of only two years, which is insu...
The Annual General Meeting will be held foreseeable on the second call on May 31st, 2019, at 12 p.m. The re-election of the Chairman is proposed in item 10. Mr. Antonio Brufau Niub has served on the Board since 1996 and has been Chairman for fifteen years. Prior to serving as Chairman, he served as CEO of the Company and Executive Chairman. There are concerns that his fixed fees of EUR 2.5 million per year imply that he continues to perform some executive functions. Furthermore, ECGS guidelines do not support the appointment of a former CEO as Chairman. This can undermine the Boardns supe...
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