Former bosses at bailed-out banks Royal Bank of Scotland and HBOS said they were 'profoundly sorry' today and admitted they under-estimated the extent of the financial crisis.
Fred Goodwin, the former chief executive of RBS, which is now nearly 70% owned by taxpayers, apologised for 'all of the distress that has been caused' in a bruising encounter with British MPs on the Treasury Select Committee.
But the ex-bank chiefs also claimed they had lost millions of pounds themselves and could not have foreseen the collapse in credit markets.
Andy Hornby, former chief executive of HBOS, said he 'never received a single penny' of his bonuses in cash during his tenure at the bank, while Mr Goodwin claimed to have lost over £5m sterling in shares having invested his bonus in stock.
Mr Goodwin and former RBS chairman Tom McKillop faced accusations of 'destroying a great British bank' and costing the taxpayer £20 billion thanks largely to their decision to buy Dutch rival ABN Amro at the peak of the market.
They said the £50 billion RBS-led takeover in 2007 was 'a bad mistake' and was now virtually worthless after the bank market collapse.
The bosses presided over RBS and HBOS during the credit crunch that brought the banks to their knees and led to the industry's £37 billion taxpayer-funded rescue.
HBOS was bought by rival Lloyds TSB and the new entity - Lloyds Banking Group - is 43% owned by the taxpayer.
MPs on the cross party Commons Committee heard how Mr Goodwin earned £1.46m last year and Mr Hornby was paid a salary of nearly £1m.
All four witnesses admitted they had no formal banking qualifications.
Mr Hornby said that while he was extremely sorry for the turn of events that led to HBOS's rescue takeover by Lloyds TSB and Government bail out, he was 'not personally culpable' for the crisis.
Dennis Stevenson, ex-HBOS chairman, added: 'All of us have lost a great deal of money, including of course a great number of our colleagues, and we are very sorry for that'.
'There has been huge anxiety and uncertainty caused for particular of our colleagues but also, for periods of time, for our customers. And I would also say we are sorry at the effect it has had on the communities we serve,' he said.
He agreed there needed to be a review across the board of banking bonuses as rage mounts over proposed payments to senior banking staff - including within part-nationalised banks.
2,300 jobs to go in RBS shake-up
Meanwhile, Royal Bank of Scotland (RBS) announced this afternoon that it is to restructure its business with the potential loss of up to 2,300 jobs.
RBS was bailed out by the British government earlier this year after running into trouble raising funds from shareholders because of the credit crunch. It is now 68%-owned by the state.
RBS, which owns Ulster Bank in Ireland, said the cuts would not affect customer-facing branch staff and pledged to make every effort to keep compulsory redundancies to a minimum. The cuts represent around 2% of the group's workforce of 106,000.
Ulster Bank had already announced 750 lay-offs in Ireland late last month.
RBS says it expects a 2008 annual loss of up to £28 billion - a record in British corporate history - due to the crisis and a costly takeover of Dutch lender ABN Amro in 2007.
