Barclays exec earns 5 times more than CEO

LONDON - BARCLAYS, the British bank that is in merger talks with ABN Amro, paid Mr Robert Diamond, its president, almost five times the compensation of its chief executive (CEO) last year.

Mr Diamond, who runs investment banking - the firm's most profitable unit and the one that helped increase last year's earnings despite rising loan losses - received £15.2 million (S$45.3 million) last year.

Mr Diamond's pay package includes a salary of &pound250,000, a bonus of £10.4 million, benefits worth &pound17,000 and share options for £4.5 million.

Mr John Varley, who in 2004 won a fierce public battle with Mr Diamond for the CEO post, earned &pound3.2 million, according to the bank's annual report published on its website on Monday.

The larger pay package for Mr Diamond illustrates how valuable he is to the bank, which invested heavily over the last three years in expanding the global securities business to compensate for anticipated slower growth at other units. Mr Diamond's unit, Barclays Capital, generates 43 per cent of the group's profits.

'Barclays' policy is to use reward to drive a high-performance culture,' it said in the annual report. 'Executive directors can expect outstanding reward if performance is outstanding.'

Barclays needs to match Mr Diamond's pay with that of other managers in global investment banks, which traditionally exceeds that of executives at companies that trade on the FTSE 100 index in Britain.

Mr Fred Goodwin, CEO of the Royal Bank of Scotland (RBS), earned about £4 million last year, while Mr Stephen Green, chairman of HSBC Holdings, received &pound2.9 million.

Barclays also paid Mr Frits Seegers, the head of consumer and commercial banking whom the bank lured away from Citigroup last year, more than Mr Varley. Mr Seegers received £5.6 million last year.

Barclays, Britain's third-biggest bank after HSBC and RBS, said last month that its second-half profit rose 41 per cent to &pound2.26 billion, from a year earlier.

NEW YORK TIMES