Barclays Plc (BARC), hosting its annual meeting today, pledged to improve the U.K. bank’s relationship with regulators and evaluate pay following recommendations made in a review by Rothschild Vice Chairman Anthony Salz.
Responding to the report, commissioned by former Chief Executive Officer Robert Diamond, Barclays said it would “develop open, transparent and cooperative relationships” with its regulators globally, complying with “the spirit as well as the letter” of rules, in a statement on its website.
Salz’s April 3 report, conducted after the London-based bank was fined 290 million pounds ($443 million) for manipulating Libor in June, criticized the lender for failings in its culture and urged it to improve openness and transparency. In parts of the company, there was “a sense that senior management did not want to hear bad news,” which “contributed to a reluctance to escalate issues of concern,” according to the 236-page report.
CEO Antony Jenkins, 51, who replaced Diamond in August, is seeking to rein in pay and boost profits to help restore investor confidence in the wake of the Libor and mis-selling scandals. Britain’s second-biggest bank by assets plans to eliminate some 3,800 jobs this year and yesterday posted a 25 percent drop in pretax profit as it took a charge for the overhaul.
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. Some senior employees received bonuses equivalent to more than double their base pay, it showed.
The lender will add non-executive directors to its board with banking experience and review whether they can commit sufficient time to Barclays. The bank aims to make most of these changes by 2015, it said.
Barclays’s remuneration committee will balance “shareholder returns and remuneration” to support “long-term shareholder interests,” it said.
Bloomberg
