Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Barclays has increased the number of its bankers earning more than €1mn a year by 49, even as the lender cut bonuses on the back of a loss in 2023.
The bank, which reported a £111mn net loss for the fourth quarter of 2023 on Tuesday, increased median fixed pay for UK staff by 9 per cent. Most of the rise benefited lower-paid staff following a deal struck with UK unions.
However 668 bankers earned more than €1mn compared with 619 a year earlier. Seven executives earned more than €9mn compared with four in 2022, the bank disclosed in its annual report.
Barclays has also been forced to hire several senior dealmakers in its investment bank, enticing them with higher pay, after about 30 quit the business last summer. Those new hires have added to the number receiving more than €1mn a year.
But Barclays trimmed the overall bonus pool by 3 per cent, from £1.8bn to £1.75bn, which it blamed on “the lower year-on-year financial outcomes in some business areas”.
Barclays’ full-year results showed group revenue fell 3 per cent in the quarter to £5.6bn, after a poor end to the year for the investment bank.
The 2022 bonus pool was cut by £500mn due to a series of regulatory and compliance scandals. The bank said that without that reduction, bonuses would be down 15 per cent this year.
Barclays is one of the first banks to outline its cut to bonuses following a brutal year for investment banking. Last week, Wall Street heavyweights Goldman Sachs, JPMorgan Chase and Morgan Stanley all disclosed pay rises for their chief executives.
Goldman chief David Solomon received a 24 per cent boost to his pay package, taking it to $31mn, despite the investment bank reporting its lowest profits in four years.
In contrast, Barclays’ chief CS Venkatakrishnan saw his pay drop 13 per cent, with his overall pay package falling from £5.2mn to £4.6mn.
Venkatakrishnan’s non-fixed remuneration dropped by 27 per cent, which was mostly due to losing £148,000 of relocation and housing benefits tied to his move to London two years ago to take up the role.
Chief financial officer Anna Cross also suffered a 25 per cent drop in her bonus, though both Cross and Venkatakrishnan were granted a 2.5 per cent increase in fixed pay.
In October last year, the UK scrapped the cap on banker bonuses inherited from its period of EU membership. The decision was part of the UK government’s post-Brexit push to boost the City of London, though pay consultants have been sceptical that it will lead to a significant change in pay.
Barclays said it would continue for now to apply a cap, but that it would “consider this further” for the next financial year. “A relatively small number of our employees are potentially impacted by this regulatory change,” the bank said.
This article has been amended to reflect the fact that Barclays reported a £111mn net loss for the fourth quarter of 2023, not for the full year
Read the full article here
