RBS’ infamous CEO Goodwin agrees to have his pension cut to $710,000 a year

Former chief executive of the Royal Bank of Scotland Fred Goodwin has decided to have his pension cut by 40% as the public has been strongly criticizing huge compensations paid to the person who is considered to be one of those responsible for the worst financial crisis in decades. His pension will be cut STG342,500 ($710,000) from STG555,000 ($1.15 million), RBS said in a statement.

"I am very pleased that we have resolved a situation that has been a difficult and unhappy one for all the parties involved," RBS chairman Philip Hampton said in a statement. According to him the agreement was achieved on the voluntary basis.

Originally the amount of money that was to be paid to Goodwin was about STG700,000 ($1.45 million) per year but in February ex-CEO of RBS exchanged part of it for a lump sum which left him with a STG555,000 annual payment.

Previously Goodwin declined government requests to give up part of his pension despite criticism from Prime Minister Gordon Brown. But this current announcement was welcomed by Finance minister Alistair Darling who said that Goodwin had done the "right thing".

"I'm very glad that RBS have now resolved the matter with Sir Fred Goodwin," the chancellor said. "I think that Sir Fred, in handing back part of his pension, is doing the right thing."

The pension deal was condemned by trade unions, which said it did not go far enough.

"For the diabolical failure by Fred Goodwin which led to the near collapse of RBS, this small gesture represents only a fraction of the massive pension that he is walking away with," said Rob MacGregor of the Unite union.

"Goodwin will still enjoy a very comfortable future at the expense of the taxpayer."