State-controlled Royal Bank of Scotland (RBS) is expected to dole out as much as £250m in bonuses to employees at its investment banking division, reports the Financial Times.

According to the report, the UK taxpayers would be burdened with the hefty bonus amount on top of a fine related to the bank's involvement in the Libor interbank lending rate scandal. RBS is expected to pay up to £500m to settle with the US and the UK regulators over the Libor-rigging scandal.

Though the negotiations are yet to conclude, RBS, which is 82 percent state-owned, is expected to pay the US regulators up to £400m while nearly £100m to be paid to the Financial Services Authority.

Though there would be backlashes, the latest bonus payments would not be "as high-octane" as in 2012, when Chief Executive Stephen Hester was offered £1m bonus which he eventually turned down, an unidentified ally of Chancellor George Osborne told the newspaper.

There would be "enormous anger if UK taxpayers pick up the tab for the individual sins of traders who were trying to rig Libor rates," Pat McFadden, Labour member of the Treasury committee told the FT.

Meanwhile, John Hourican, RBS' investment bank chief is expected to receive share bonuses worth £4m, weeks before his expected departure, according to a report in the Guardian.