Balied-out bank seeks $1.5B in bonuses

The Royal Bank of Scotland wants to pay close to $1.5 billion in bonuses to its staff, just months after being rescued by a taxpayer bailout, sources say.

The Sunday Telegraph, quoting unnamed sources, said the bank’s board has begun discussions with U.K. Financial Investments, the body set up by the British government to manage its shareholdings in ailing banks, about paying out the bonuses.

RBS received nearly $30 billion taxpayer funds to bail it out late last year. It now risks increasing public anger as the recession deepens, the newspaper said.

Elsewhere in the same edition of The Sunday Telegraph, British Chancellor of the Exchequer Alistair Darling announced in an opinions piece a plan for an independent review of the way banks are managed, including the bonus system.

We cannot return to business as usual, Darling wrote in the newspaper. It is in everyone’s interest to get banks’ governance right. It would be wrong to reward people whose excessive risk-taking brought the banks down, causing misery to millions of their customers.