Charity to benefit from HSBC chief's £4m bonus

MICHAEL Geoghegan will become the highest-profile UK banker to accept a bonus this week – before immediately giving it all to charity.

The chief executive of HSBC is expected to be awarded a pay-out of about 4 million today, with the bank thought to be preparing to reveal a profit of 10 billion for 2009.

Last week, the chief executives of Barclays, Royal Bank of Scotland (RBS) and Lloyds Banking Group all waived their personal bonuses, although each of the banks still awarded bonuses to hundreds of their staff.

Both RBS and Lloyds were bailed out by the UK taxpayer during the financial crisis; Barclays narrowly avoided a government funded re-capitalisation.

HSBC did not take money directly from the UK taxpayer and continued to pay dividends. The bank is thought to consider itself free to pay bonuses.

But the fact that Geoghegan is likely to pay the bonus immediately to charity suggests the bank is still sensitive to criticism regarding bonuses.

Standard Chartered also reports 2009 results this week. Peter Sands, its chief executive, is thought likely to accept a pay-out, which could be in the region of 1m.

Unlike the other FTSE 100 banks, Standard Chartered has little business in the UK, focusing instead on emerging markets and former British colonies.

Geoghegan's gesture – reportedly set to be directed to a children's charity of which his wife has been a long-time supporter – follows a protracted argument with HSBC's shareholders over salary, with the bank trying to award him a 40 per cent pay rise.

Shareholders rejected the plan, but are believed to have indicated that they are comfortable with the bank paying executive bonuses to other staff members.