Barclays plans to cut or claw back about £450-million of pay from its staff over a rate-rigging scandal that last year forced out its chief executive officer and chairman, a person close to the matter said on Wednesday.
About another £140-million ($212-million U.S.) will be clawed back from past pay packages due to other misdemeanours such as mis-selling payment protection insurance (PPI) and allegedly misinforming customers about interest rate swaps products, the person said.
Barclays, fined about £290-million last June by U.S. and U.K. regulators for manipulating Libor benchmark interest rates, will slash the 2012 bonus pool by roughly the same amount due to Libor issues and claw back about £160-million from employees’ deferred share awards from earlier years, the source said.
The bank declined to comment.
The scale of penalties, first reported by Sky News, shows new chief executive officer Antony Jenkins wants to demonstrate the bank is punishing staff for the reputational damage caused by the scandals and address criticism from investors that pay was too high.
Barclays said two weeks ago it would still pay about £1.8-billion pounds in variable pay for 2012, down 14 per cent from 2011. It will release further details on salaries in its annual report, expected to be released next week.
The bank will also unveil more details about the pay levels of all its 140,000 staff in the report in a bid by new chairman David Walker to improve transparency.
The bank is set to release pay bands for all staff, the source said, including how many earned more than £1-million – a number that could top 500.
Walker has pushed for banks to release the numbers of staff included in pay bands of £1-million to £2.5-million, £2.5-million to £5-million, and over £5-million.
In the past, Barclays only disclosed the pay of its top eight earners as well as the average pay of staff in risk positions, or so called code staff. In 2011, 238 code staff earned an average of £1.5-million, including long-term awards.