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£2.6m bank chief bonus as jobs cut

NATIONAL Australia Bank has unveiled a £2.6 million bonus plan for chief executive Cameron Clyne, even as the institution cuts hundreds of jobs at its troubled UK arm, Clydesdale Bank.

NAB is to ask shareholders at its annual investor meeting on December 13 to agree to grant Mr Clyne Aus$1.2m (£800,000) of so-called performance rights under a short-term incentive scheme. He will be given another Aus$2.7m of performance rights under a long-term incentive plan.

Performance rights are similar to shares except they do not accumulate dividends.

The long-term award is subject to performance hurdles.

NAB finance director Mark Joiner, appointed to the Clydesdale board in June, is in line for an award under the same schemes worth up to Aus$1.6m.

The awards could prove controversial with NAB shareholders because in the 12 months to September 30 the company posted a 22% drop in net profit to Aus$4.1 billion, much of this fall due to the performance of Clydesdale Bank.

Glasgow-based Clydesdale recorded a £183m loss for the year as it was hit by bad debts on its property loan book. Chief executive David Thorburn is overseeing a turnaround plan that will see the bank retreat to its heartlands in Scotland and northern England, where it owns Yorkshire Bank.

The bank said at the end of October that it had reduced headcount by 468 so far this year. In all, 1400 people are expected to leave by September 2015.

The bank anticipates cutting fewer than 100 jobs in Scotland.

A Clydesdale spokesman declined to comment yesterday.

Despite its problems, Mr Clyne has indicated that NAB plans to hold on to Clydesdale for at least a while, asserting that investors do not want to see a distressed sale.

Some business borrowers have complained that Clydesdale's withdrawal from commercial property lending could hit the Scottish economy.

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