A controversial payout in the banking world has sparked debate.
Paul Thwaite, the CEO of NatWest, has secured the largest compensation package for a banking group executive since the infamous Fred Goodwin's reign in 2006. Thwaite's £6.6 million payout for 2025 surpasses that of his predecessor, Alison Rose, and marks a return to the pre-financial crisis heyday of the bank, then known as Royal Bank of Scotland (RBS).
But here's where it gets controversial: Thwaite's earnings are a stark contrast to the bank's recent history. Goodwin's excessive spending and poor decision-making led to a £45 billion government bailout during the 2008 crisis, bringing the bank to its knees. Yet, Thwaite's pay package is now back at those pre-crisis levels.
When asked about the appropriateness of his earnings, Thwaite expressed pride in NatWest's achievements and acknowledged the high pay in financial services. He emphasized the link between executive pay and performance, stating that it fluctuates based on results. However, he did not directly address the controversy surrounding his compensation.
Thwaite's earnings were not only due to the bank's privatization but also a decision to lift the banker bonus cap, allowing his bonus to exceed twice his salary. This move was part of a UK-wide reversal, with politicians and regulators hoping to attract high-earning bankers post-Brexit.
In addition to his salary, Thwaite received a £4 million bonus, including a substantial annual increase. This came as NatWest reported a significant rise in pre-tax profits for 2025. The bank also increased payouts for its top bankers, with the group bonus pool reaching its highest level since 2013.
And this is the part most people miss: NatWest's annual report revealed that 89 "material risk takers" earned over €1 million in 2025, with 20 of them earning between €1.5 million and €2 million. The bank employed 59,000 permanent staff, highlighting the significant gap between executive compensation and regular employees.
NatWest's bankers are not alone in their lucrative bonuses. Barclays, a rival bank, also announced its largest bonus pool in 12 years, with bankers sharing £2.2 billion for the 2025 financial year. This comes after Barclays reported a 13% rise in full-year profits.
So, is this a sign of a thriving banking industry, or a return to the excessive practices that led to the 2008 crisis? What do you think? Feel free to share your thoughts and opinions in the comments below!
