Santander offers retention bonuses for A&L execs

LONDON (Reuters) - Spain's Banco Santander (SAN.MC), which last month agreed to buy Alliance & Leicester for 1.3 billion pounds, is offering bonuses of up to 125 percent to key executives if they agree to stay on until next December.

The Spanish bank already owns lender Abbey in Britain and hopes to use A&L ALLL.L to boost its market share, branch and customer network and to establish a "critical mass".

In a scheme document on the deal sent to shareholders on Tuesday, Santander said it would offer retention arrangements for "key employees" including A&L's four executive directors -- Chief Executive David Bennett, Finance Director Chris Rhodes, Risk Director Richard Banks and Manufacturing Director Ian Buchanan, hoping they will help smooth the transition process.

They could get between 75 percent and 125 percent of their basic salaries for remaining with the bank until the end of November next year. If they leave before then on good terms -- ill health or redundancy -- they will be entitled to a pro-rata payment, the bank said.

Santander said no decision had been made on non-executives, but it will offer 100 free Santander shares to each A&L employee on completion of the deal later this year.

A&L shareholders are set to vote on the deal at an extraordinary general meeting on Sept 16.

(Reporting by Clara Ferreira-Marques; editing by Sue Thomas)