Barclays slashes 2011 bonus pool (From Northwich Guardian)

Barclays slashes 2011 bonus pool

7:37am Friday 10th February 2012 in National News © Press Association 2011

Banking giant Barclays has slashed the bonus pool for its investment banking arm by 32% in 2011 to £1.5 billion amid mounting pressure over the controversial payouts.

The average bonus for staff at Barclays Capital was cut by 30% to £64,000 as volatile market conditions saw the powerhouse division's profits slide 32% to £2.96 billion. Meanwhile, the group's total bonus pool was down 25% at £2.2 billion with the average payout for a group employee down 21% year on year to £15,200.

Elsewhere, the bank, which reported pre-tax profits of £5.8 billion for 2011, down 3% on the previous year, said it had capped the cash part of bonuses for investment bankers at £65,000. This compares to £2,000 at the state-backed banks.

The results come after weeks of conflict over bankers' bonuses, in which Royal Bank of Scotland chief Stephen Hester turned down his £963,000 bonus amid mounting pressure and Lloyds boss Antonio Horta-Osorio waived his own payout following a leave of absence.

Chief executive Bob Diamond refused to be drawn on questions about his own bonus, amid reports he could be in line to receive more than £11 million in payouts.

The results said that annual incentives for executive directors and the eight highest paid senior executive officers were down 48% compared to 2010 on a like-for-like basis, though Mr Diamond would not confirm how his own pay fitted into this decline.

Mr Diamond hailed Barclay's business lending record in 2011 as it beat the so-called Project Merlin targets drawn up between Britain's top five banks and the Government.

Barclays delivered £43.6 billion of gross new lending to UK businesses, including £14.7 billion to small and medium-sized enterprises, exceeding its Merlin target by 13%. "We really got on our horses to get businesses going," Mr Diamond said.

Those hoping for a peek at Mr Diamond's pay packet will have to wait until the annual report is published in mid-March. But addressing the wider issue of bonuses, he said: "We need to balance remaining competitive with being responsive to the public mood."

However David Fleming, Unite national officer, said: "The announcement on bonuses today by Barclays is yet another illustration of the banking sector continuing to ignore the public outrage and disgust at their behaviour. Serious questions exist about the moral backbone of those running the financial service sector, while they find it acceptable to ignore the misery working people face with our economy in turmoil."