Singer hit by payout to former boss

A £1.9m payout to former Singer & Friedlander chief executive John Hodson knocked the profits of the niche banking group in 2004.

Singer, in which Icelandic bank Kaupthing has a 19% stake, revealed it took the payment to Mr Hodson as a one-off charge in 2004.

The company also wrote off £2.3m invested in a computer system.

The impact of these two items took £4.2m off the group's operating profits which were £30.8m compared with £22m in 2003.

However, the bank, which has undergone a major restructuring in 2004, actually suffered a fall in pre-tax profits from £93m to £31m.

The previous year's figure was boosted by a £68m profit on the sale of its stake in stock broker Carnegie.

New chief executive Tony Shearer said that during the year it had concentrated on putting together a new management structure, expanding banking and investment management, taking action on businesses which were not earning a return and cutting costs.

Mr Shearer also said the group had spent a "great deal of resources" on complying with new European directives and international accounting standards.

He said: "These burdens show no sign of reducing and many of them have, as far as we can see, few benefits to clients or shareholders."

The group will pay a 7.25p dividend, up from 6p. The shares fell 5.25p yesterday to 270.5p.