Stephen Karle, the ousted chief executive of West Bromwich Building Society, bagged a £520,600 pay-off last year, including an £82,000 bonus, despite steering the lender to the verge of bankruptcy after loading it with risky commercial loans.

Including his pay and benefits, Karle earned £686,600 for seven months’ work before his sudden departure in October at the height of the financial crisis. He is also entitled to a £95,000-a-year pension from the age of 65 after building up a pot worth £1.3m.

The revelation is likely to renew concerns about 'rewards for failure', which are as rife in the mutual sector as at the banks. Four directors at Derbyshire shared £1m in payoffs last year after their distressed lender was taken over by Nationwide. Cheshire’s top two directors took home almost £500,000 between them. Both societies made losses and neither set of members received a penny from the takeovers.

Daily Telegraph