Barclays president due for £4.7m payout

Barclays bank president Bob Diamond was in line for a payout of up to £4.7m (€5.2m) today after the bank sold part of its fund management business to bolster its finances.

The $4.4 bn (€3.3bn) sale of the iShares operation will trigger windfalls for Mr Diamond and a host of other directors with stakes in the firm.

Mr Diamond has 300,000 shares and options in iShares owner BGI Holdings and the payout will cushion the blow from Barclays' decision to scrap 2008 bonuses.

This left the Barclays president with a £250,000 (€277,512) basic salary for last year - a fraction of the mammoth £21.1m (€23.4m) in pay and bonuses he enjoyed in 2007.

Under the bank's share investment scheme, Mr Diamond and more than 200 executives own 4.5% of BGI through an arrangement approved by Barclays shareholders in 2000.

The bank, which has shunned the Government's bail-out schemes in favour of its own fundraising, has sold its iShares business to private equity firm CVC.

Chief executive John Varley said the business had seen rapid growth and reached a point where it could develop further independently of the bank.

"Barclays shareholders will benefit from a reinforcement of our capital base and an ongoing commercial relationship with iShares," he said.

The sale of iShares boosts Barclays' equity tier one ratio - a key measure of its capital strength - to 7.2%. Investors welcomed the move as Barclays' shares soared 10% following the sale announcement.

The iShares business has around 620 employees in 14 countries. It is part of the Barclays Global Investors (BGI) division and the world's biggest provider of exchange traded funds (ETFs), with around 360 products and a market share of around 47%.