Bank set to reignite anger over bonuses by releasing millions of pounds of shares to top staff under performance-related deals
Top bankers at Barclays are expected to have millions of pounds of bonuses handed out in the coming days in a move that could trigger fresh controversy about City pay.
Just a week after the bank was forced to admit that HM Revenue & Customs had shut down two of its schemes designed to avoid £500m in tax, Barclays is thought to be preparing to release millions of pounds of shares to its highest-ranking staff under performance-related pay deals handed out in the past.
Among those in line for the rewards are Rich Ricci and Jerry del Missier, who run the Barclays Capital investment bank, Tom Kalaris, head of wealth management, Antony Jenkins, head of the retail bank, and Robert Le Blanc, who is head of risk.
Disclosures made to the stock exchange appear to suggest they stand to receive up to £7.5m from pay deals they were agreed in 2010, although the bank will also have to disclose other elements of their complex pay deals which will push their total packages higher.
Last year, the five shared in £110m when deals from previous years paid out, making them the five highest paid Barclays executives. The disclosures emerged under the Project Merlin deal agreed with the government to highlight pay deals outside the boardroom. HSBC last week became the first to comply with Treasury requirements to publish the top eight highest paid executives, rather than the top five, who shared £30m between them.
The Barclays finance director Chris Lucas could get 1.6m shares, worth £4m at current prices, from a three-year long-term incentive plan that is due to vest in March 2012. It is subject to performance criteria which means it is unlikely that he will receive the full amount, the 2010 annual report shows.
Lucas would have been closely involved in the two "highly abusive" share deals that the Treasury shut down a week ago on the advice of HMRC, even taking the unusual step of retrospective changes to the law which left Barclays with a £300m tax bill for gains it had made on buying back its own debt on the market.
The publicity surrounding the closure of the tax avoidance scheme came just a fortnight after Bob Diamond had been heralding the bank's approach to "citizenship". His pay for his first full year as chief executive – after more than decade running Barclays Capital – will also be disclosed when the bank's remuneration report is published within the next fortnight. He has admitted that the bank's return on equity – a key measure scrutinised by shareholders – has fallen well short of the 13% target he had set for 2013.
The Barclays payouts come as Stephen Hester, chief executive of Royal Bank of Scotland, is on course to be handed £600,000 related to his work for 2010. The £600,000 is based on an award of 4.5m shares he received last March, half of which are due to be handed to him on 7 March, although he has agreed not to sell them for 12 months. Eight of his senior management team are also scheduled to receive their share awards from 2010, worth about £1.2m, which they cannot cash in for six months.
Hester is also among top RBS bankers poised to get a combined £11m when bonuses awarded three years ago pay up.