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Barclays Says 5.3% Oppose Pay Report as Walker Seeks Moderation

Barclays Pledges Better Regulator Relations in Review Response
Barclays paid its top 70 executives “consistently and significantly above” the industry norm, according to the Salz report. Photographer: Chris Ratcliffe/Bloomberg

April 25 (Bloomberg) -- Barclays Plc said 5.3 percent of shareholders opposed its executive-pay report at its annual general meeting as Chairman David Walker said the era of excessive compensation is behind the bank.

The lender had “overpaid” employees in the past and is “determined to be moderate in the outcomes we produce” on pay, Walker told investors in London today.

“We need to give you, our shareholders, a bigger share of the income we generate through dividends and we need to challenge the expectation that performance-related pay is guaranteed,” Walker said.

Antony Jenkins, 51, who replaced Robert Diamond as chief executive officer in August, is seeking to rein in pay and boost profits to restore investor confidence in the wake of the Libor and mis-selling scandals. Britain’s second-biggest bank by assets today pledged to abide by the recommendations made in a review by Rothschild Vice Chairman Anthony Salz in April, which was critical of past compensation at the bank.

Some shareholders at the meeting said the bank is still overpaying its management.

Joan Woolard, 75, from Lincolnshire, England, told Walker she lived on 726 pounds ($1,120) a month, “quite comfortably,” and described executives paid 1 million pounds a year as “greedy.”

“Banks have brought us down,” Woolard said, “I don’t understand how you can sleep at night.”

Board Sympathy

“You can be assured the board is sympathetic to these concerns,” Walker said.

Jenkins was awarded 2.3 million pounds in salary and long-term bonuses last year, compared with 6.3 million pounds Diamond received in 2011. Last year 27 percent of shareholders voted against Diamond’s 12 million-pound compensation package.

Jenkins said in February he won’t take a bonus for 2012 after a series of regulatory mis-steps including the fine for attempting to rig global interest rates. Jenkins was in line for a bonus of at least 1 million pounds, the Guardian newspaper reported on Jan. 29.

The bank awarded 428 workers with more than 1 million pounds in 2012, down from 473 in 2011.

The shares fell 0.3 percent to 293.7 pence in London. They have gained 12 percent this year, giving the company a market value of 37.8 billion pounds.

Improve Openness

Salz’s report, conducted after the London-based bank was fined 290 million pounds for manipulating Libor in June, criticized the lender for failings in its culture and urged it to improve openness and transparency.

Barclays paid its top 70 executives “consistently and significantly above” the industry norm, according to the Salz report. Managing directors at Barclays’s investment bank received base pay of about 150,000 pounds to 300,000 pounds, as well as an average bonus of about 70 percent of their salary in 2012.

Jenkins today also told shareholders not to expect the bank’s return on equity, a measure of profitability, to exceed its cost of equity before 2015.

About 8 percent of votes today were cast against allowing the bank to issue further securities, the bank said in a statement.

To contact the reporter on this story: Howard Mustoe in London at hmustoe@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net

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