Belfast Telegraph

Massive bonus deal for new Barclays boss provokes fury

By Jamie Grierson

Barclays has named Bob Diamond, an American banker with an estimated fortune in excess of £100m, as its new chief executive.

Mr Diamond will take over from current chief John Varley in March.

Mr Varley leaves after a 14-year spell with Barclays that has seen him turn its investment banking arm into a business so large it generates more than 80% of the bank's total profits.

The 59-year-old, one of the world's richest bankers, will be paid a £1.35m annual salary, up from the current £250,000, and stands to receive potential bonuses worth another £10m.

In a day of upheaval in the banking sector, HSBC executive chairman Stephen Green also announced plans to step down in favour of a role in David Cameron's government.

Mr Green, who has been chairman since 2005, will replace Lord Davies, the former Standard Chartered boss, as trade minister.

Mr Diamond said he was "honoured" to take on the new role, but the move is likely to enrage some politicians and union leaders.

Many consider Mr Diamond - with an estimated worth of £100m - to be the epitome of the excessive bonus culture.

Although he waived his bonus last year after widespread criticism of bankers, he received £26m for his shares in Barclays Global Investors, the bank's fund management business, when it was sold to America's BlackRock.

Mr Diamond was criticised in April by politicians including Lord Mandelson and Vince Cable when it was claimed he received £63m under a reward scheme. However, in his new role, Mr Diamond will receive an annual bonus of £3.375m on top of his salary, as well as a long-term performance-based incentive worth £6.75m.

Barclays said the payments were benchmarked against a financial sector peer group.

Paul Kenny, general secretary of the GMB union, said the appointment was "insulting".

He said: "These are the bankers who caused the recession sticking two fingers up at the taxpayers who rescued them. This is about as insulting and divisive as it gets. A person who poured petrol on the flames of the fires in the financial system has been rewarded rather than been punished."

Mr Diamond, who previously missed out on the role to Mr Varley in 2004, is expected to have relocation costs covered as he moves to London from New York, where he has spent the past two years integrating the acquisition of Lehman Brothers into Barclays Capital.