Page last updated at 14:02 GMT, Saturday, 16 January 2010

'Disgust' at new job for ex-RBS chief Sir Fred Goodwin

Sir Fred Goodwin at the offices of RMJM in Edinburgh with chief executive Peter Morrison
Sir Fred Goodwin (left) at the offices of RMJM in Edinburgh with chief executive Peter Morrison

Royal Bank of Scotland shareholders have criticised the appointment of Sir Fred Goodwin by the architectural firm RMJM in Edinburgh.

The consultancy role will be his first job since leaving RBS after the government bailed it out 15 months ago.

Roger Lawson, from the RBS Shareholder Action Group, said it was "ironic" Sir Fred got a job when others were losing theirs in the recession the banks made.

Independent MSP Margo MacDonald said her reaction was "faint disgust".

Michael Connarty, Labour MP for Linlithgow and East Falkirk, said it was a "very odd appointment".

Sir Fred, who was born in Paisley, was in charge at the bank for nine years and steered it from being a bit-part player to one of the top five in the world.

He built up the bank with numerous acquisitions but the problems started when RBS bought the Dutch bank ABN Amro at the height of the boom in 2007.

ANALYSIS
Joe Lynam
BBC business correspondent
"It was an opportunity too good to turn down" - that's how the world's 5th largest architecture firm described its appointment of the former RBS boss Sir Fred Goodwin.

RMJM is hiring Britain's most famous ex banker - a man who many blame for all but destroying one of its largest banks and pocketing an enormous pension upon retiring aged 50.

RMJM, which is using Sir Fred as an adviser, also said that the blame for the near collapse of RBS couldn't be laid at the foot of one man.

Sir Fred is not the first banker - blamed for the near collapse of the system 18 months ago - to get a job.

The former boss of HBOS Andy Hornby runs the privately owned high street chemist chain Boots.

Mr Lawson's shareholder group is pursuing a legal claim against RBS for its £12bn rights issue in May 2008.

That RBS share sale for 200p per share was made five months before the near collapse of the bank and its rescue by taxpayers.

The bank is now 83% controlled by the UK government, with shares having collapsed by 95% since their high point in 2007.

Sir Fred retired from RBS in September 2008, aged 50, with a controversial pension of £700,000 per year - a figure which has been subsequently reduced.

Mr Lawson said: "It's ironic that he's managed to get a job when others are being let go - and in a recession which banks are responsible for.

"One must question whether the folks who are hiring him are prudent - given that his reputation will precede him everywhere he goes."

Sir Fred - dubbed "Fred the Shred" - has been appointed as a senior adviser with architectural practice RMJM, where he began work just before Christmas.

It was involved in designing the controversial Scottish Parliament building, though the current management had no involvement in that project.

Sir Fred will be based in Edinburgh but will spend the vast majority of his time overseas.

He will not be on the RMJM board but will join four or five other members of the senior advisory panel of the business.

Mr Connarty said: "People wonder what he knew about banking and will now wonder what he knows about building."

Pay package

The Labour MP added: "There is a deep irony that one the architects of RBS's downfall is now working for the architects involved in the Holyrood building fiasco."

Ms MacDonald said: "One of the things that people objected to, and I think with good reason, was the size of Mr Goodwin's pension pot.

"It now transpires that he is not really pensioned off at all, he is quite capable of earning money with another company."

The company would not comment on Sir Fred's pay package, though said it was in line with that of the existing senior advisers to the business.

A spokesman from Sir Fred's new employer told the BBC: "We've known Sir Fred on an informal basis for years and it was an opportunity which was too good to turn down.

"He has an ability that's proven over 20 years."

"We're very impressed with him and he's impressed with us and the rationale for appointing him will become clear going forward."



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