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Sunday, February 28, 2016

Barclays To Pay Ousted Boss £500,000 Bonus

Barclays is to pay its former chief executive a performance bonus of hundreds of thousands of pounds despite sacking him last summer after board members decided he was not transforming the bank quickly enough.
Sky News has learnt that Barclays' remuneration committee has determined that Antony Jenkins should receive a payment of around £500,000 on top of millions of pounds of other contractual entitlements due to him until July.
The news of the annual performance bonus will be disclosed when Barclays publishes its remuneration report alongside its results for 2015 on Tuesday.
The City will be watching this week's announcement closely for details of how Mr Jenkins' successor, Jes Staley, plans to reshape the company to take account of regulatory reforms across the global banking sector.
The Swiss Cottage branch of Barclays Bank
However, the news of the bonus payment to the former chief executive may raise fresh questions about whether the Barclays board was correct to judge that a change of leadership was necessary.
The bank's chairman, John McFarlane, orchestrated Mr Jenkins' sacking, saying that "we are leaving value on the table and a new approach is required.
"As a Group, if we aspire to bring shareholder returns forward, we need to be much more focused on what is attractive, what we are good at, and where we are good at it."
In the statement announcing Mr Jenkins' exit, Barclays said: "The [remuneration] committee has determined that Mr Jenkins will remain eligible to be considered for a pro-rated 2015 bonus for time in role as group chief executive, subject to an assessment of the relevant performance measures relating to his 2015 bonus and the general discretion of the Committee."
His employment contract stated that Mr Jenkins was eligible for a maximum bonus of £1.64m - or 80% of his total fixed pay of £2.05m.
The timing of his departure in early July, just over halfway through the year, therefore meant that the top payout he could have been awarded for 2015 was £840,000.
A bonus of around £500,000 signals the Barclays board believes that Mr Jenkins achieved a substantial amount during the first six months of the year.
Less than a month after Mr Jenkins was sacked, Barclays unveiled a strong set of half-year results, with net profit rising 43% and returns from its investment bank showing substantial improvement.
Announcing those half-year numbers, Mr McFarlane said: "We were very clear to say his departure had nothing to do with current performance."
In addition to the annual bonus, Barclays has already disclosed that Mr Jenkins is "entitled to 12 months' notice from the company under his contract of employment and will therefore continue to receive his current salary (£1.1m per annum), role-based pay (delivered in Barclays shares) (£950,000 per annum), pension allowance (£363,000 per annum) and other benefits until 7 July 2016".
The bank added: "In accordance with the plan rules and as an eligible leaver, all outstanding deferred share awards will continue to be eligible for release at the original scheduled release dates. 
"Similarly, outstanding [long-term incentive plan] awards will be considered for release, subject to the applicable performance conditions and pro-rated for time, on the scheduled release dates. 
"Deferred share awards and LTIP awards will remain subject to the relevant plan rules and terms of the awards, including additional holding periods following vesting, malus provisions and, where applicable, clawback."
Mr Staley's appointment - which came after he had narrowly missed out on the top job to Mr Jenkins in 2012 in the wake of Barclays' involvement in the LIBOR rate-rigging scandal - was well-received by Barclays shareholders.
Since joining, he has announced a fresh wave of job cuts in Barclays' international investment banking operations.
On Tuesday, he is expected to outline a plan to offload the group's large African business.
Barclays will also say that its bonus pool was cut from £1.86bn in 2014 to about £1.7m last year, as Sky News revealed a fortnight ago.
Mr Jenkins could not be reached for comment on Sunday, while Barclays declined to comment.

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