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Barclays 'set to reveal pay cuts'

Barclays will reportedly attempt to defend itself against "banker bashing" this week by revealing that it has cut pay and met targets for lending to businesses.

A source told the Sunday Telegraph that Barclays will reveal on Friday that it has lent 13% or 14% more to British businesses in 2011 than agreed in its Project Merlin negotiations with the Government.

The UK's five biggest banks agreed to make £190 billion available to businesses in 2011, which was £11 billion more than the previous year, although the targets for individual banks were not made public.

Barclays is also set to announce plans to cut pay by as much as 30% for 24,000 staff at its Barclays Capital investment banking arm as it responds to outrage over bankers' bonuses.

The figures are expected to be released as it reports pre-tax profits of between £5.5 billion and £6 billion, down from £6.1 billion the previous year, after its powerhouse investment arm was hit by volatile market conditions in the final quarter of 2011.

But pay for the top executives will not be revealed until the company's annual report in the second half of March.

The newspaper said chief executive Bob Diamond could trouser as much as £11 million, including a bonus of between £2.5 million and £3 million. On top of that, he received a salary of £1.35 million and could be given long-term incentives worth as much as £6.75 million, which will vest in three years, it added. With other benefits, that would bring his maximum compensation for the year to £11.7 million.

The rewards for Mr Diamond and other senior executives, which are still being drawn up by the bank's remuneration committee, are believed to be slightly smaller than they would have been as a result of the furore over bankers' pay.

The move comes just days after Royal Bank of Scotland chief executive Stephen Hester waived his bonus of nearly £1 million and its former boss Fred Goodwin was stripped of his knighthood for leading the bank to the brink of collapse.

Labour leader Ed Miliband has called for a tax on bankers' bonuses ahead of a House of Commons vote on the issue on Tuesday, while British Bankers' Association chief executive Angela Knight called for the public debate on banking not to "descend to personal attacks on individuals" and accused politicians of making "inflammatory speeches".


From Belfast Telegraph