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* 2012 bonus pool 365 mln pounds, down 3 percent
* Lloyds says bonus payouts lowest of big four banks
* CEO's bonus linked to shares hitting break-even price
* Lloyds to claw back some 2010 bonuses
* Co-operating with authorities in investigations
By Matt Scuffham
LONDON, March 25 (Reuters) - Britain's part-nationalisedLloyds Banking Group paid 25 staff more than 1 millionpounds ($1.5 million) each in 2012, a year in which it set asidebillions of pounds to compensate customers mis-sold loaninsurance.
The bank, which is 39 percent owned by the UK taxpayer, saidon Monday it paid bonuses worth a total of 365 million pounds in2012, down 3 percent on the previous year and the lowest of thebig four British lenders.
That equated to an average 3,900 pounds for each of thebank's employees.
Bankers' pay has come under intense scrutiny following ayear of scandals including interest rate-rigging, breaches ofanti-money laundering controls and mis-selling.
Despite that, Barclays paid 428 bankers more than 1million, HSBC did the same for 204 employees and RoyalBank of Scotland handed million pound-plus pay deals to95 staff.
Lloyds said Chief Executive Antonio Horta-Osorio had beenawarded an annual bonus worth 1.5 million pounds, paid inshares.
He will only be able to sell the shares if the governmentdisposes of at least a third of its shareholding at a priceabove 61 pence, or if Lloyds' share price trades at 73.6 penceor above for a given period of time.
Shares in Lloyds closed at 47.8 pence on Monday, leavingtaxpayers sitting on a paper loss of 7 billion pounds.
The government has said it could break even selling itsshares at 61 pence, stock which it acquired when it rescued thebank during the 2008 financial crisis.
The break-even price takes account of fees the governmenthas already received from the bank which it bought into at 73.6pence.
Lloyds said it had also awarded Horta-Osorio shares under along-term incentive plan with an expected value of 1.1 millionpounds. Horta-Osorio receives a basic salary of 1.2 million.
Lloyds said 20 staff earned between 1 million and 2 millionpounds in 2012. Five were paid between 2 million and 3 million.
In its annual report, Lloyds said it was co-operating withgovernment agencies investigating a global interest rate riggingscandal. The bank said it was not possible to predict the timingand scale of the potential impact from the investigations.
Barclays was fined $453 million last June for its role inthe affair and Royal Bank of Scotland was hit with fines of $612million in February this year.
Lloyds has set aside 6.8 billion pounds to deal with claimsfrom customers mis-sold payment protection insurance (PPI) onloans and mortgages and 400 million pounds to compensate smallfirms wrongly sold complex interest-rate hedging products.
Lloyds, which has raised its PPI provision five times, saidthe rate of complaints being received was now declining.
The bank paid out around 200 million pounds a month in thefourth quarter of 2012, about 25 percent lower than in the thirdquarter.
Lloyds expects the monthly payout to fall by around 20percent in the first half of 2013 and fall further in the secondhalf.
Like other British banks, Lloyds is under pressure to reinin executive pay and cut costs. In response to the PPI affair,the bank said it planned to claw back bonuses awarded to somedirectors in 2010.
Former Chief Executive Eric Daniels attracted criticism inFebruary when he defended the sale of the products, saying thatmost had not been mis-sold.
