Page last updated at 11:08 GMT, Thursday, 26 February 2009

Profile: Sir Fred Goodwin

Sir Fred Goodwin
Sir Fred was known in the City as a ruthless cost cutter

Four months after leaving Royal Bank of Scotland, former chief executive Sir Fred Goodwin is under fire for the generosity of his £650,000-a-year pension.

Sir Fred, who stepped down after RBS had to be bailed out by the government, revelled in his nickname of Fred the Shred for cutting costs and jobs.

Commonly described as the most charismatic and also most abrasive of the banking bosses, Sir Fred's position became untenable as the bank was propped up with £20bn of public money - now bolstered by another £13bn cash injection.

Sir Fred was in charge at RBS for nine years and steered it from being a bit-part player to global icon as one of the world's top five banks.

He built up the bank with acquisition after acquisition - NatWest, Coutts, Adam & Co, Direct Line, Ulster Bank, Churchill and Citizens Bank in the US - and then ruthlessly cut costs through staff reductions to generate bigger profits.

But the wheels started to come off with the acquisition of ABN Amro as part of a consortium at the height of the boom in 2007.

Even before his departure, Sir Fred was under fire because of heavy losses and a £12bn rights issue to raise more money for RBS.

Vintage cars

Before leaving RBS, Sir Fred split his time between the City of London and the bank's new headquarters on the edge of Edinburgh.

He is married to Joyce and has two children, but he has worked hard to protect his family's privacy.

Sir Fred likes to restore vintage cars and the Royal Bank of Scotland's long association with Formula One may be in part due to his passion for cars. It certainly did not last long after his departure, as it has now emerged that RBS will end its sponsorship of the Williams Formula One team at the end of 2010.

He plays golf, and is a fan of rugby. The bank is heavily involved as a sponsor of the Six Nations rugby union championship and it recently extended its sponsorship for a further four years in a deal worth £20m.

RBS sign
The RBS became one of the world's top five banks

Sir Fred was a regular visitor to No 11 Downing Street when Gordon Brown was chancellor.

Sir Fred attended grammar school in Paisley and then went on to Glasgow University.

He studied law and later became a chartered accountant in 1983 rising to partner at Touche Ross five years later.

Sir Fred led the team handling the liquidation of the Bank of Credit and Commerce International and his subsequent banking career took him to top positions at the Clydesdale Bank and Yorkshire Bank after which he joined the board of RBS in 1998.

He was knighted for his services to banking in 2004 and Sir Fred has been chairman of the Prince's Trust charity for a number of years.

The chief executive agreed to waive a pay-off, which includes the right to a year's salary - £1.29m in 2007. Including his £2.86m bonus, he was paid a total of £4.2m that year.

But it has now emerged that the 50-year-old is already drawing payments from a pension pot worth £16m.

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