Barclays president bites back at bonus busters

LONDON - Barclays president Bob Diamond yesterday rounded on the bank's critics for focusing on bonuses when the company reported record profits of £11.6 billion ($26 billion).

Diamond said: "These are remarkable results and they are customer-driven. This is business we are doing with clients across the world. When you look at Barclays Capital I would think you should be immensely proud that it is now the number one investment bank for fixed income, not just in Europe but in the US."

Diamond said questions about pay had "an edge to them". He and Barclays chief executive John Varley have waived their bonuses for a second year running. Other executives will have their entire bonuses deferred and paid over three years.

However, the bank has still put together a £2.7 billion bonus pot, much of which will go to the 23,000 people who work at Barclays Capital. Of that, just £1.2 billion will be deferred.

Investment bankers' pay and bonuses will mean the average package comes in at more than £190,000 at BarCap, although some will earn much more than that. The average income they generated was over £500,000.

Barclays insisted it was "in full compliance" with recent guidelines on how bankers should be paid to prevent a repeat of the wild risk-taking by some banks that many blame for the financial crisis.

The bank expects to pay £225 million as a result of the Chancellor's "one-off" 50 per cent levy on bonuses of more than £25,000. Overall, Barclays reported record income of £31 billion, up 34 per cent on 2008, although some of the sparkle was taken off by a sharp rise in impairment charges, which reached £8.1 billion, up 49 per cent.

However, impairments fell in the second half of the year, and Barclays expects the situation to show further "modest" improvement this year.

But there were no really serious "single company" losses facing Barclays in 2009, and this might not be repeated.

- AP