Top city banker gets £22m pay package

A banker at Barclays netted £22m (€32.5m) in salary, shares and bonuses last year and owns stock in the group worth nearly £65m (€96m), it was revealed today.

Bob Diamond, head of investment banking at Barclays, became one of Europe’s highest-paid bankers after receiving the multi-million pound pay package, which dwarfed even chief executive John Varley’s salary and bonus scoop.

Barclays, which is currently in merger talks with ABN Amro, said in its 2006 annual report that Mr Diamond was paid a basic salary of £250,000 (€360,000), with a £10.4m (€15.4m) cash bonus on top, plus £4.5m (€6.6m) in deferred shares, topped up with £7.7m (€11.4m) in cashed-in shares.

It also emerged that Mr Diamond owns shares in the group worth £64.9m (€95.9m) accumulated over his 11-year tenure at Barclays and is in line for a further bonus of up to £15m (€22m) next year, not including the 2.3 million shares he is set to gain in the group as part of an on-going performance-related deal.

Barclays today defended the bumper pay package, saying the investment banking, wealth management and asset management division headed up by Mr Diamond has been very successful, with Barclays Global Investors alone making the group some £2bn (€2.9bn) a year.

The American investment banker, aged 55, joined Barclays in July 1996 from CSFB, where he was vice-chairman and head of global fixed income and foreign exchange.

He has grown the investment banking arm rapidly in recent years and the division contributes around 44% of the bank’s £7bn (€10.3bn) annual profits.

Barclays’ 50-year-old head Mr Varley, meanwhile, earned just a fraction of Mr Diamond’s salary last year, at a mere £2.5m (€3.7m) in basic pay and bonuses, with just £700,000 (€1m) from a deferred share bonus award.

Frits Seegers, who was appointed chief executive of retail and commercial banking last July, received £1.6m (€2.3m) in pay and bonuses in 2006.

Barclays’ six top executives were paid a total of more than £26m (€38m), according to the report.

Richard Broadbent, chairman of the bank’s human resources and remuneration committee, said in the annual report that “performance has been recognised in the remuneration decisions at all levels”.

The pay package revelations come as Barclays enters advanced merger talks with Dutch rival ABN Amro in a deal that would create one of the world’s largest banks.