Barclays Plc, under pressure to trim its securities unit, paid its investment bankers an average bonus of about 54,100 pounds ($84,439), more than double the annual pay of British employees.
Bonuses fell 17 percent in 2012 from 65,085 pounds for each employee a year earlier, the London-based company said in its full-year earnings statement today. Average pay for U.K. full-time employees is 26,500 pounds, according to the Office for National Statistics.
Investment banking will remain a “sizable part” of Britain’s second-largest bank by assets, Chief Executive Officer Antony Jenkins, 51, told Bloomberg Television’s Francine Lacqua in an interview today. During a six-month strategic review the lender didn’t seek “a specific proportion for one business or the other,” he said.
Barclays announced plans today to cut 1,800 positions at the investment bank as part of changes that included closing its structured capital markets tax planning unit. The bank has been under scrutiny from legislators since it was fined 290 million pounds in June for attempting to manipulate the London interbank offered rate and other benchmark interest rates, with some of the lender’s top executives, including former CEO Robert Diamond, departing.
The investment bank’s bonus pool fell 15 percent to about 1.3 billion pounds for its 24,000 employees, based in cities including London and New York, Barclays said.
“The awards at investment banks are heavily skewed toward the top performers and the range for bonuses is usually vast,” said John Purcell, CEO of Purcell & Co., a London executive-search firm. “There are some bankers who will be receiving seven-figure bonuses.”
Barclays will defer all 2012 awards for the bank’s 1,200 managing directors at the investment bank and pay bonuses of as much as 65,000 pounds in cash for more junior staff, a person with knowledge of the plans said earlier this month. Managing directors’ bonuses for 2012 will all be deferred and paid in one-third installments from 2014 to 2016, half in cash and half in shares, said the person, who asked not to be identified as the plans aren’t yet public.
For more junior staff, awards greater than 65,000 pounds and less than 250,000 pounds will see 35 percent of the total deferred and paid half in cash and half in stock. Any bonus of more than 250,000 pounds will be deferred, with half being paid in cash and the rest in stock, the person said.
Revenue at the investment bank rose 13 percent to 11.72 billion pounds in 2012, driven by its fixed-income, currency and commodities business, equities and prime services, the company said today.