By Karrie Gillett
SHAREHOLDERS of the Royal Bank of Scotland have overwhelmingly approved a £20 billion government bail-out.
At a general meeting, shareholders voted 99.28% in favour of the proposal, in which the bank will sell up to £15 billion in shares with the Government buying those not taken up.
More than 300 shareholders gathered in Edinburgh to support the deal which could see the government gain up to 60 per cent of the crisis-hit financial institution.
And chairman Sir Tom McKillop – who retired after the meeting – insisted that accountability for the bank’s recent failures had been fully accepted.
McKillop also announced that Chief Executive Sir Fred Goodwin would be stepping down from his position – being replaced by Stephen Hester.
Sir McKillop said: “The buck stops with me as Chairman and with the leadership of the group. Accountability has been allocated and fully accepted.”
There was a sombre silence at the gathering in the capital’s Assembly Hall on The Mound as the resignations of Goodwin and McKillop were confirmed.
An explanation from the chairman on why the board had found themselves asking for shareholders’ support in raising capital for the second time in a year lasted for approximately 25 minutes.
McKillop said: “As shareholders you deserve to hear the Board’s view on the events leading up to today and on how our company became vulnerable as the global financial crisis intensified.
“You deserve to hear this explanation, but you also deserve more.”
And following that, Sir McKillop lead on to what the majority of disillusioned shareholders were waiting for – an apology.
He said: “I, as the Chairman of RBS Group, both personally and in the office I hold, am profoundly sorry about the position we have reached.
“I feel this sincerely, on a number of levels and for a variety of reasons.”
It wasn’t until almost a full hour later and after a round of questions from shareholders that Sir Fred Goodwin apologised.
A Mr Blackie, a former member of staff and a shareholder, said there were lots of angry people in the room who would like to see the chief executive say sorry.
Sir Goodwin then stood up and said: “I am extremely sorry. I am extremely sad to be leaving this company.
“I am extremely sorry in these extremely difficult times.”
There was a murmur of laughter as Chairman McKillop moved to reassure shareholders that their best interests were being protected as the global financial crisis continued.
McKillop said: “You may laugh but I can assure you that it’s the way we have operated throughout.”
After announcing his retirement, McKillop claimed he had total faith that the government deal was a “well-considered” package.
He said: “Our position reached a tipping point during October of this year as out share price suffered more than most other UK banks.
“We are therefore grateful for the Government’s intervention.”
But one shareholder blasted the move shouting “the government is holding the bank to ransom.”
The shareholder – who spoke during open questions to the board – said: “I for one feel the bank is
going to be held to ransom. It’s so annoying and I feel annoyed for everyone as a shareholder.”
After the meeting, a woman who has been a shareholder for almost 40 years echoed the comments made during questioning.
The 77-year-old woman – who asked not to be named – said: “It’s terribly sad to see it come to this.
“We’ve been through tough times before but nothing like this. I really don’t know what the future will bring.
“Stephen Hester definitely seems to really value the shareholders and took time to speak to us before the meeting but it’s desperate times to even be here today voting on this issue.
“Sir Fred Goodwin’s apology seemed sincere but it means nothing at the end of the day when our share prices have fallen this low.”
One shareholder – Mr Fred Lawson – joked: “I used to be a rather large shareholder but like most of us here today it’s now rather small.”
Earlier this month, RBS announced it expected to reveal its first full-year loss in its almost 300-year history.