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Bob Diamond gives up £20m bonus

(Update) Bob Diamond, Barclays’ former chief executive, has bowed to pressure and agreed to waive bonuses of up to £20 million.

 

When asked, therefore, if Diamond had lied to the Committee Agius refused to comment.

Agius was also questioned by MPs over the FSA's annual review of the bank, quoting a letter sent from FSA chief Lord Turner earlier this year in which he raised concerns that 'Barclays has a tendency continually to seek advantage from complex structures or favourable regulatory interpretations'. He gave several examples of instances where Barclays was 'aggressive', 'not fully transparent' and sought to 'spin messages in an unhelpful fashion'.

There was a moment of humour when Agius claimed someone from the Financial Services Authority had told him on the way to a meeting that ‘you’re best in class’. Chairman Andrew Tyrie quipped, 'well I dread to think of the reports we’ll see on other banks!'

Tyrie added that Diamond had shown a 'complete lack of candor' in his meeting with MPs and thanked Agius for his own 'direct and frank' answers.

When asked how he felt that a great British bank had been dragged through the mud, Agius said: 'I regret deeply what has happened at Barclays and I am truly sorry'. He added that Barclays could not have done more to co-operate with the authorities' investigations and that it was now suffering now from a 'first mover disadvantage'.

Agius' evidence comes just one day after Paul Tucker, deputy governor of Bank of England, appeared before the Treasury Select Committee. Diamond gave his testimony last week.

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17 comments so far. Why not have your say?

William P Colquhoun

Jul 10, 2012 at 11:47

Now is the time, when banks are so much in the spotlight, for the banking industry to lead the way in both integrity and also in ending the bonus culture which is doing huge harm in so many areas. For instance this culture is damaging health care. It encourages risk-taking for personal profit. A salary should be paid for someone doing their job properly. If they do not do it properly, then either re-train or sack. You should not get a bonus for doing your job properly. Bonuses encourage greed and behaviour which is not in the interests of the firm, hospital or whatever kind of organisation uses them. So Bankers, seize the day and lead the way in developing & spreading ethical standards in business. They are needed right across the world in all spheres of life. And without them, economic crises will multiply and capitalism, which should be benefiting all, will perish. The problems of today are the opportunity to build a new and better tomorrow. After all, years ago the City set the standard world-wide for integrity in business. Why not again?

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Gonk

Jul 10, 2012 at 11:49

Lots of hired spin doctors spinning away here to try to save the skins of

Agiuis and his fellow Barclays' directors.

Barclays under Agius have been at the forefront of most of the highly abusive tax avoidance schemes, have been declared just today the worst performing bank in the UK for corruption transparency, have a shockingly low RoE, and are now quite unbelievably trying a whitewash operation regarding their Libor fixing.

Let's hope the police do a better job than the incompetent, complacent and plainly stupid politicians and the apparently totally gullible financial press.

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Keith Simmonds

Jul 10, 2012 at 13:03

As a Barclays business customer I would like to know why the revenue the bank receives from my account and also from other customers is being used to pay a spiv such as Bob Diamond. Perhaps the only thing to do is to close my account.

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Steve Hayes

Jul 10, 2012 at 13:38

I don't mind employees benefitting when things go well, in every sort of businesses we want people to be working as a team towards the same ends.

But "things going well" needs to be kept simple, and if things go badly (meaning badly for the shareholders in this case), whether it's hard luck or poor judgement then bonuses shouldn't be paid. Beyond that I'll keep singing the same tune, if a bank goes bust then the directors should be bankrupted as well, no questions about fault etc, it's just part of the deal.

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Raz.

Jul 10, 2012 at 13:46

I closed my Barclays accounts, having been a good customer for over 40 years, when Mr Diamond was appointed. There was plenty of adverse comment at the time and I heeded the warnings. No one from the bank asked me why I was leaving which I think showed how little they valued retail customers and the sort of culture that was developing.

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Tom Bourne

Jul 10, 2012 at 16:46

Can anyone explain why he should be paid a year's salary even though he has resigned? I was under the impression that if a person resigns a position all remuneration should stop!

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S G

Jul 10, 2012 at 17:01

@ Tom

A lot of Directors and senior managers have do not compete terms in their contract. These range from everything as not working for a company in the same business area eg Dimond going to HSBC for a set period eg 6 months.

I have heard these contracts can be anything up to 5 years. There is also parts in the contract for the managers and directors to assist. This basically means they may not be able to work for an x amount of time. So in the contract they get x salary. Like most people in employement you are let go, you normally receive a months notice. As you get higher and higher the month turns into months which can also be up to a year......

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peter hart

Jul 10, 2012 at 17:27

Ditto Raz. Now trying to extricate myself from Barclays Stockbrokers. A long and winding road but getting there. Hargreaves Lansdown here are come.

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Enrico

Jul 10, 2012 at 21:17

It seems as its still a big cover up.They are obviously all in bed together.No on deserves to be paid anything extra when they resign even if they have a clause in their contract that you cannot use your experience in the same line of work.

Any company with ethics should never employ the hierarchy from Barclays as there was an extremely nasty hidden agenda to line their own pockets and ignore the "common people" eg.99% of us.

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Ian W

Jul 10, 2012 at 21:39

" Agius said the board and he had originally thought Diamond and two other directors giving up their 2012 bonuses was the 'proportionate response' to the Libor rigging scandal and the £290 million of fines it brought down on the bank. However, 'the public outcry was extraordinary and evidently we were wrong."

FFS, what planet do these people live on?

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ted via mobile

Jul 10, 2012 at 22:03

Bob is mad to give up 20 mill I wouldn't no way.

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Martyn

Jul 10, 2012 at 23:26

Some bright spark in Barclays thought that if they paid bonuses they would not have to continually increase salaries and pension payments. Only good performers would benefit and the poor performers would leave as their remuneration was static (and reducing by inflation). Theory!

Unfortunately they could not tell the good performers from the poor performers!

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Sandy Matheson

Jul 11, 2012 at 02:46

What is not clear to me in these "scandals" is what happens to 'the £290 million of fines'. Where does that end up? I expect that within Barclays this goes into the accounts as operating costs and eventually gets charged back to the customers. I expect the same happens when airlines etc. are fined. This system of fining companys does not properly punish the culprits or attempt to recompense the victims. Maybe they should be compelled to reduce their customer charges or something similar.

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Gonk

Jul 11, 2012 at 08:03

Ian W. It does indeed make you wonder what planet they inhabit!

In many ways there is a close analogy here with the child sex scandals in the Roman Catholic Church when for many years it was considered sort of all right for a priest to have a bit of sex with an underage child - and then the tide of opinion changed thank goodness and these creepy people were gradually uncovered.

Perhaps this is the "paedophile moment" for the banking industry when for many years this sort of plain fraud, as conducted by Barclays, has been perpetrated with a nod and a wink.. And exactly as with the rest of the thoroughly decent folk in the church the most fed up people now are the majority of highly honest people that do exist in banking and the City.

Mr Plod in the UK may sadly take another few years to realise the time for action is now, or as with the Vatican stonewalling sex investigations he may get impeded by powerful vested interests, but perhaps The Fed in the USA will do us all a favour.

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Rose G

Jul 11, 2012 at 12:04

One rule for the ordinary man in the street, and another for those in select places, having unbreakable contracts.

Barclays and the other banks, have made redundancies of high street bank staff, did these people get such generous remuneration - off course not, they do not move in the same circles.

The attitude of those at the top end of the banking industry, Diamond et al, are protected by their peers, no one else with any integrity, will defend them.

Across the board, from politicians who flip their second homes, and claims for duck ponds and treating damp to the tune of thousands, the policemen who were in cahoots with the Murdochs and their empire, the politicians who are in such close contact with their business sponsors, the media who pay the police for information - all of these demonstrate the current trend to make big bucks, never mind the conflict of interest in their actions.

We have travelled a few years down the road from the financial crisis, and we in the UK are yet to bring the scoundrels who have been found to have participated in dodgy dealings to justice. The US and their SEC are more robust in their approach to those who have been found to have done wrong, but the law regarding bankers, politicians, the police or the media in the UK seems a bit of a no go area because they are all protected by their individual sectors - therefore they believe they are beyond the law and conduct themselves as insulated from what the ordinary individual and the law is concerned, they are above and beyond the law, and they are also paid sums of money that are not in keeping with their conduct.

The widespread ideology that permeates the banking sector is that they are too big to fail, so once again, they know that inspite of dodgy and frankly criminal actions, they will not be brought to justice - why are we then surprised when those working in this sector believe they can and do get away with criminal behaviour.

These are the very people who should be hung, drawn and quartered, but what we do is stand in awe of them, the amounts of money they can lay claim to, while they walk away from their misdeeds with millions in their pay packet.

Anyone who has had to resign as a result of any wrong doing, or fired for their wrong doing, should not get even a penny, yet diamond will receive millions, even after giving up his bonus. The whole bonus culture has created the problems, and yet we are not addressing this as a challenge to the law, but as if someone was found with his finger in his pie, and only faces questioning by inept politicians - is this how we treat people who have demonstrated time and again that they are beyond the law and protected from the highest sources.

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S G

Jul 11, 2012 at 12:43

Disagree that its totally one rule for one, one rule for another.

A lot of Directors and CEO's, Move fairly regularly around the industry, but as jo blogs in the street normally have to give a months notice, these CEOs have to give a lot longer notice periods. There is at least 20 times as many CEO job changes due to normal career changes to every CEO being pushed/jumping ship due to a scandal

Majority of these directors have created wealth, and have the knowledge and skill. Why not pay someone 15million if they are going to make you 20! Better then paying 1 million and only getting 4!

The issue is some Directors just like normal employees are crap, and somehow manage to get through jobs on people they know... The only way to get around this is to take out this of the equation, let shareholders make more decisions.. If a company is fined, fine the Directors and CEO's as well, so they feel the hit, as when the company is fined it is normally passed on to customers. The buck stops with them, for them to ensure the people under them have good ethics.

That brings me on to another point, many CEO's employee people under them to manage many business areas, so a lot of the time they only have a high view, profits and costs normally not the everyday in and outs. No this is not a "let him off the hook" it is actually "where are the people who did the actual rigging?" Are they still there? have they moved on somewhere else and taken their ethics with them??

Rate/Price rigging has been around since the businesses started. The Electric Companies are doing it, Mobile Phone Providers are doing it, Supermarkets, even bloody councils, and many many other industries. But these also get little press, and CEO's are on just as much money as bankers.

The issue is far greater then just the banking sector! It all needs to be sorted somehow!!

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Rose G

Jul 11, 2012 at 13:53

SG - if you read through my post, you will note that I am arguing that this is not just the banking sector which has lost its way, but many of our very important institutions, who seem to believe that their actions will not be scrutinised by the public and found wanting. You will also note that nearly all of those who I have mentioned in my previous post are allegedly self regulating, the banks, politicians, police and the media - they all know that their regulatory bodies and frameworks are internal - any information they then choose to release to the public, is not open to scrutiny by outsiders. Even if their actions are open to the public, there is no one with the remit to authorise escalation to others - they like to keep in house, where no actions taken are the norm!

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