John Hourican always had to run RBSs investment bank with at least one hand tied behind his back. Now he is to leave the firm with others hands in his pockets.
John Hourican, RBSs investment banking head
Hourican is reported to be giving up remuneration of around £4 million, accumulated for doing what his peers concede to be just about the toughest job in the industry today, as he takes management responsibility for the rigging of Libor markets that took place before he ran the business and the buck stopped with the Irishman.
Privately, he must be seething. Publicly, he is doing the honourable thing on behalf of the bank he has helped to steer through arguably the toughest fall-out anywhere in the world after the financial crisis. Paying him £4 million when RBS is about to hand over a cheque to regulators for 100 times that for its part in the Libor scandal is politically the right thing to do.
Lets hope those colleagues staying on at RBS, both above and below him in the pecking order, appreciate the gesture as well as the vastly slimmed down, but still in certain markets top-tier, business that he is leaving.
Houricans four years as head of RBSs investment bank has been fraught with difficulty. On appointment in October 2008, his main task was simply to hold the firm together while attempting to review every single business line.
Decisions to exit certain businesses, such as equities, probably took longer than they should have done. The process of reducing assets in a bloated balance sheet happened quickly by necessity.
But Houricans finest achievement is to hand over businesses in areas such as foreign exchange, rates and debt capital markets, where RBS remains relevant and still competes on a daily basis with the biggest players on the street.
Those businesses rely on good people as well as good technology and infrastructure. Hourican a steely man but one always with a ready smile persuaded enough of the good people to stay on, allowing those businesses to contend, if not to flourish.
From day one, Hourican never lost sight of the key challenges he faced. In his first interview in the role, with Euromoney in May 2009, he said: Our job is to recover value for our shareholders. And we will do that with people who want to be here and have the skills and drive to fulfil the potential within our business.
That means we have to pay competitively to keep or get the right people. My bond with my staff is that they will not be disadvantaged for working at RBS rather than our competitors.
The irony is clear now: it is John Hourican, more than anyone else, who has been disadvantaged for working at RBS.
But Hourican is well respected in the industry. And although a return to his native Ireland in a senior banking role might be his first choice, there should be a queue of those competitors seeking someone with his abilities.
Not least of those is that Hourican, throughout his tenure and right to the very end, has been in essence an honourable man. The banking industry could do with a few more of those. The pity is that few have seen this side to him, clouded as their judgement is by his leading the problem division of a bank that everyone loves to hate.