The former chief executive who took Lloyds to the brink of collapse has won a legal battle to receive a £1.4million bonus it withheld.
A judge ruled Eric Daniels had earned the money for overseeing a tie-up with toxic rival HBOS, which was bought under his leadership during the financial crisis.
Lloyds had insisted he did not deserve the payment because the tainted deal later brought the bank to its knees and forced a £20.3billion taxpayer bailout.
A judge ruled Eric Daniels had earned the money for overseeing a tie-up with toxic rival HBOS, which was bought under his leadership during the financial crisis
But in a blow to shareholders who have seen their shares fall from 360p to 60p, the bank has now been ordered to pay Daniels in full within a month.
Campaigners and MPs blasted him for demanding the cash, saying he has been rewarded for a debacle that cost millions of shareholders their life savings when the lender’s stock price crashed.
Labour MP John Mann, who is a member of the Treasury select committee, said: ‘This man has got no shame.
A troubled tenure
Eric Daniels is the American who ran Lloyds from 2003 to 2010
He oversaw the disastrous merger with HBOS in 2008 at the height of the financial crisis
Weeks later, the bank needed a £20.3billion taxpayer bailout
He lost a £2.3million bonus after bank sunk to a £6.3billion loss
The bank also took away his £1.4million bonus relating to the merger
‘I trust he’ll be donating all of this money to charity. I suggest Sport Relief. He’s simply being rewarded for failure.’
Fran Boait of banking reform group Positive Money said: ‘A decade on from the financial crisis, ordinary people are still paying the price for banks’ reckless behaviour.
But instead of being held to account for their disastrous decisions, bosses like Eric Daniels have been rewarded with eye-watering salaries and bonuses.’
Daniels, 66, had been promised a payout of shares in 2012 if he oversaw cost-cutting targets by combining Lloyds with HBOS.
He hit these goals but the bank refused to pay the money given the huge crisis the deal had caused.
Mrs Justice Cockerill has ruled in the High Court that the bank did not have the power to do this and that Daniels must get the shares – worth £1.4million at today’s prices.
Lloyds’ former investment bank head Truett Tate, who had also sued over withheld shares, will get stock worth £933,000.
Lloyds has been ordered to pay them what they are owed in lost dividends, and to cover their legal costs.
American Daniels left Lloyds with a £5million pension pot and now works for small City investment bank Stormharbour.
Lloyds, Daniels, Tate and other directors are being sued by furious investors over the HBOS deal, which sent the bank’s stock price crashing and left shareholders nursing huge losses.
A Lloyds spokesman said yesterday: ‘We accept the court’s decision and now consider this matter closed.’