NatWest has been accused of “unjust” profiteering as it handed its boss Alison Rose a £5.2m pay package and upped its bonus pool for bankers, after the bailed out lender made its biggest profit since 2007 on the back of higher mortgage costs for customers. The bank – which is still 44%-owned by the taxpayer – revealed on Friday that Rose’s pay had soared by 46% from £3.6m a year earlier, partly because of the higher value of shares doled out as part of her long-term incentive plan. Rose also received a cash bonus – worth about £326,500 – the first paid to a NatWest chief executive since 2007, when the lender was still known as Royal Bank of Scotland, and is now the bank’s second-highest paid chief executive after the disgraced former CEO Fred Goodwin. It came as NatWest increased the total bonus pool for its bankers to £367m from £298m a year earlier, after making bumper profits of £5.1bn in 2022, up 33% and the highest since 2007, when profits hit £10bn. The rise in profits last year was partly as a result of a sector-wide rise in loan and mortgage costs, exacerbating the wider cost of living crisis for borrowers. Campaigners said bankers were unfairly reaping the benefits of rising interest rates, while taxpayers have yet to recoup the £45bn used to rescue the lender and public sector workers were being denied fair pay. “NatWest is using bumper profits to deepen its bonus pool, not to support the public, who bailed it out just 15 years ago, and who are now footing the bill of the higher interest rates boosting those very same profits,” said Fran Boait, the executive director at campaign group Positive Money. “It is completely unjust that bankers who create only more wealth for the already rich get pay boosts whilst those who educate, transport and care for the public are forced on to picket lines for fair wages.” She said the government should reconsider plans to lift the cap on banker bonuses and heed calls for a windfall tax “in order to provide struggling communities”. Unite’s general secretary, Sharon Graham, said the pay and profits being reported by banks such as NatWest were “offensive” in light of pay disputes with public sector workers. She said: “Ministers are insisting NHS workers take another savage pay cut while their big City banker friends are given carte blanche to make billions. “Rishi Sunak needs to put a real powerful windfall tax on the excess profits of the big banks. Like the energy companies, the greed of the big banks is fuelling the cost of living crisis. An epidemic of profiteering has brought this country to its knees – workers are not responsible for it and should not have to pay for it. It is time the government held the big business interests that profit, while everyone else pays the price, to account,” Graham added. The NatWest chair, Howard Davies, defended the bank’s pay decisions. He said the bonus pool was up “from a particularly low level” and that the bank was paying its executives less than some of its peers. “That should be compared against the fact that profits are up by about a third. So we think this is a totally appropriate level of remuneration for our senior people,” Davies said. “The board thought about it very carefully, and we think it’s totally appropriate.” Barclays revealed a £5.2m pay packet for its chief executive, CS Venkatakrishnan, earlier this week. NatWest confirmed that Rose’s pay was the second highest only to the £7.7m package paid in 2006 to to Goodwin whose excess spending on controversial acquisitions, private jets and new headquarters were criticised for crippling RBS and contributing to its £45bn government bailout during the banking crisis in 2008. While NatWest’s annual report at the time indicated that Goodwin had been paid a “total” of £4m in 2006, the bank said on Thursday that the figure did not account for a £1.9m pension payment and share payouts worth £1.8m – which were disclosed in separate sections of its yearly disclosure. The bank said it had only been reporting single-figure pay since 2012. The rise in NatWest’s profits follows an increase in net interest income – the difference between what the bank charges for loans and what it pays in interest on deposits – which went up by 30% to £9.8bn. Rose and the chief executives of Britain’s other big high street banks earlier this month denied shortchanging savers by failing to increase interest rates on savings accounts at the same pace as the rise in the Bank of England base rate. Despite the rise in profits, NatWest’s shares were down 6.6% on Friday, as the bank warned of uncertainty ahead. Investors fear that an economic slowdown, paired with a slower pace of interest rate increases, could curb profit growth in the year ahead. “NatWest may have delivered its biggest profit since the financial crisis but investors are far more concerned about what’s coming next and that’s less positive,” said Russ Mould, investment director at AJ Bell. “Income for 2023 is now guided to be lower than expected, with the key net interest margin metric also falling short. Costs are also set to be higher than forecast.” Some of the largest payouts since 2006 2011: Barclays’s Bob Diamond is paid £11m Former investment banker turned chief executive Bob Diamond sparked controversy after he received a bumper pay packet worth £11m in 2011. He had been granted a £1.35m salary, but also received a £2.7m share bonus, as well as £474,000 worth of perks including personal financial advice and chauffeurs. That was on top of share payouts and deferred payments pre-dating the financial crisis. 2011: HSBC’s Stuart Gulliver is paid £7.2m The ex-chief executive of HSBC took home £7.2m in 2011, a year when he was allowed to earn three times his £1.25m salary as an annual bonus, and six times that total as part of a long-term incentive plan, which covered a three-year period. He could have been paid a maximum £12.5m, but failed to reach key targets such as cost cuts return, strategy and reputation. 2014: Lloyds Banking Group’s António Horta-Osório is paid £11.5m The former boss of Lloyds Banking Group – which rescued HBOS from collapse and subsequently took a £20bn state bailout in 2008 – received his highest payout in 2011. The package, which included a £7.5m bonus linked to a three-year pay scheme, attracted criticism from the Trades Union Congress, which said the excessive pay was an “outrage” for taxpayers who footed the bailout bill. 2015: Standard Chartered’s Bill Winters is paid £8.4m Bill Winters, a former investment banker at JP Morgan, was paid £8.4m in his first year on the job at emerging markets-focused lender Standard Chartered. The figure was bolstered by a share-based buyout award, meant to compensate him for quitting Renshaw Bay, the hedge fund he was running previously.