Lloyds CEO to get £10 mln pay package

Part-nationalised British bank Lloyds gave its new chief executive Antonio Horta-Osorio a long-term pay deal potentially worth some 10 mln pounds ($16 mln), according to its annual report.
Horta-Osorio, who joined Lloyds this year after running rival Santander UK, got his basic salary increased to 1.061 mln pounds from an original 1.035 mln since Lloyds deemed the original pay to be "behind the market".
Lloyds added he would also be compensated for various share and cash awards which he had forfeited upon leaving his previous job to replace Eric Daniels as Lloyds' new chief executive.
This comprised a share package worth some 3.6 mln pounds, based on Lloyds' recent share price of around 60 pence.
Lloyds gave Horta-Osorio 1.71 mln shares due to vest in 2013, subject to how the bank performs against its peers. It also awarded him a further 4.35 mln shares due to vest between 2011-2013, provided he remains at Lloyds.
His maximum potential bonus for 2011 was 225% of his basic salary, namely around 2.4 mln pounds, but Horta-Osorio was granted a long-term incentive award worth 420% of his salary which would be equivalent to 4.5 mln pounds.
Horta-Osorio also got a cash payment package of 516,000 pounds, due to vest in three equal tranches between 2011-2013, and a retirement benefit scheme worth around 280,000 pounds.
Under new rules forcing banks to disclose the remuneration of their most highly-paid executives, Lloyds added that one un-named individual received a package worth 4.83 mln pounds, made up of 500,000 in basic salary and the rest in shares which can't be cashed in until an unspecified later date.
Its second-highest paid executive got a 3.05 mln pound pay deal, Lloyds said. Neither are board members, as in many other banks where the top earners are traders or dealmakers and are not the most senior executives.
Lloyds' pay remains well below that of many rival banks, however, since it has a minimal investment banking presence. British rival Barclays Plc paid new boss Bob Diamond and two other top directors 28 mln pounds last year.
The British government holds 41% of Lloyds and has an 83% holding in Royal Bank of Scotland Group Plc after bailing out both banks with billions of pounds worth of taxpayers' money during the credit crisis.
Earlier this year, RBS said its chief executive Stephen Hester could get up to 4.5 mln pounds in shares under a long-term incentive plan.
Due to the state bailout, both RBS and Lloyds were ordered by European regulators to sell a string of assets, and earlier this week Lloyds appointed JP Morgan and Citigroup to oversee the sale of 600 bank branches.
Britain hopes eventually to sell its RBS and Lloyds stakes, although authorities have said any sale is unlikely until the UK's Independent Commission on Banking (ICB) publishes its final report on the sector in September.
Lloyds shares closed down 2.8% at 58.55 pence.