There are reports that RBS lawyers have advised the board to resign on mass if the government intervenes to block any bonus payments.** Accepting any restrictions would apparently make RBS uncompetitive and break the board’s fiduciary duty to shareholders. They would be left with no choice but to walk.
This is all terribly interesting. But before you start calculating the potential repercussions for Alistair Darling, just remember one thing: RBS is owned by the taxpayer. The government holds a 70 per cent stake which will soon rise to more than 80 per cent. Under UK company law, Darling UKFI can ask for whatever they want and legally the board must obey.