Belfast Telegraph

Bank bosses get rough ride over 'obscene' pay

By peter Cripps

Barclays bosses have been given an uncomfortable ride by shareholders amid anger over "obscene" pay packages at the banking giant.

A series of private investors used the bank's annual meeting to complain that dividend payments had fallen since the financial crisis while high-flying staff were still commanding high salaries and bonuses.

The heated event came hours after Barclays revealed that pre-tax profits dropped 9% to £1.66bn in the first quarter of 2011 after income and profits at its investment banking arm fell sharply.

Some 11% of the votes cast at the meeting at London's Royal Festival Hall failed to back the remuneration report, which spelled out plans to pay its new chief executive, Bob Diamond, a package of up to £28m.

Under the terms of the scheme, Mr Diamond is paid £1.35m a year, 23% more than his predecessor John Varley.

He is also set to receive a bonus of £6.5m for 2010, a future conditional share award of £6.75m and £13.8m of shares he is owed as part of previous long-term performance plans.

The report also contained plans to pay some of its staff bonuses in a form of bond that will attract interest of 7% a year until they mature.

One shareholder, Trevor White, told the board their bonuses were "obscene" and claimed the bank's high earners were set to pocket nearly as much as before the financial crisis struck.

"When will shareholders get proper recognition?" he said in a tirade that drew applause from the crowd.

Former merchant seaman David Hawker said: "In these times of austerity the seemingly excessive payments to senior bank staff seems to show the lack of wisdom reminiscent of Marie Antoinette saying let them eat cake."

Chairman Marcus Agius defended the bank. "How would you have thought of us if we had underpaid our staff and they had chosen not to stay with the bank?" he asked.

Mr Diamond also denied that Barclays could move its headquarters away from the UK if the Government's reforms for the banking industry prove too demanding.

He said: "I want to assure you that we have had no discussions with US regulators or regulators anywhere else in the world about moving - none. We have been here for 300 years - this is our home."

While investors had their say in the hall, there was also a protest outside as demonstrators from the World Development Movement claimed the bank was "profiting from hunger".

Dressed in bowler hats and selling loaves of bread at inflated prices, they said Barclays speculates on food commodities, which is driving up prices and having disastrous consequences for some of the world's poorest people.

Meanwhile, Barclays came under pressure after revealing that its investment arm saw pre-tax profits decline 33% to £982m in the first quarter of the year.

Total income, excluding insurance claims, was down 8% to £7.4bn reflecting the "subdued macroeconomic environment".

Weekly Business Digest Newsletter

This week's business news headlines, directly to your inbox every Tuesday.