Increased Bonus to Lloyds Boss Eric Daniels

Recently, there has been an announcement made by Lloyds Banking Group regarding its strategy to pay a larger bonus to its Chief Executive, Eric Daniels.

It has been reported that the bank plans to pay Mr. Daniels up to £2.83m in shares as a long-standing bonus which will be equal to 275% of his £1.03m salary.

According to the bank, the amount they plan to offer is more than the earlier limit of 200% of his existing salary, the bank also believes that it is essential to give an increase in order to keep its pay competitive.

The shares would be added to Mr. Daniels' £2.3m yearly bonus.

In the beginning of 2010, Daniel said that he would not take his 2009 bonus, in the middle of the controversies over bankers' pay.

It was reported that the share awards would be according to Lloyds the long-term performance, which would include an increase in its share price over 114 pence. That is also said to guarantee profits for taxpayers, who at present hold 41% of the bank.

On Friday, Lloyd’s shares closed at only above 64 pence.

The latest incentives were placed following discussion with UKFI, which is an organization for managing taxpayer stakes in the bank.

It is said that the planning consists of postponing the payment of bonuses until 2012, with clauses that permit the bank to scrape the payments back.