By Mark Kleinman, City Editor
The UK's biggest banks slashed the number of employees earning at least £1m last year in a move they will argue demonstrates that they are heeding calls for greater pay restraint.
Sky News understands that Barclays, Lloyds Banking Group and Royal Bank of Scotland (RBS) will disclose alongside their annual results during the next eight days that the number of millionaires they created during 2014 fell sharply from the 583 a year earlier.
Insiders familiar with the figures said that the combined number of £1m-plus pay deals across the three banks would fall to approximately 450.
That decline partly reflects the fact that the bonus pool at each bank will be lower for 2014 than in the previous year despite the fact that City analysts expect them all to report stronger financial performances for the last 12 months.
Sky News revealed last week that the three banks were close to finalising bonus pools worth an aggregate £2.8bn, down from nearly £3.4bn in 2013.
However, the fall in the bonus pools can be partly explained by the fact that under new European rules, banks have shifted sums of money from senior employees' variable pay to their fixed remuneration.
This has led some critics to accuse the banks of sleight of hand in seeking to claim credit for reducing bonus payouts just weeks before the General Election campaign gets underway.
The banks are therefore likely to argue that the reduced number of millionaire pay deals - the figures for which include both fixed and discretionary pay - is illustrative of their determination to exhibit more restraint.
Last year, Barclays said it had paid 481 staff more than £1m, while at Lloyds the figure was 27 and at RBS, 75.
Collectively, bonuses at the three banks will be roughly 15% lower than the equivalent numbers for 2013.
Barclays, which is independent of the taxpayer and has by far the largest investment bank of the three institutions, will say that bonuses fell from almost £2.4bn in 2013 to below £2bn last year.
The fall will come amid a retrenchment at Barclays' investment bank, with thousands of jobs being shed under a revamped strategy announced last year by Antony Jenkins, the chief executive.
Analysts are forecasting an uptick in annual profits at Barclays, which is due to report its results on March 2.
The news on pay will mark a contrast with last year's situation at the lender, which provoked a row with some leading shareholders by increasing bonuses despite a fall in profits.
Barclays has also set aside £500m to pay fines related to control failings in its foreign exchange operations, although it has yet to reach a formal settlement with any regulators.
Lloyds and RBS will collectively pay out approximately £875m in bonuses for 2014, sources said on Thursday, compared to an equivalent figure of roughly £975m a year earlier.
The two banks, which report results towards the end of the week, are continuing negotiations over their bonus plans with UK Financial Investments (UKFI), which manages the taxpayer's stakes in them.
Sky News revealed on Friday that the chief executives of Barclays, Lloyds and HSBC would receive annual bonus awards for 2014 totalling more than £3m, although the payouts have been reduced because of fines imposed on them for mis-selling and market manipulation.
HSBC will kick off the reporting season on Monday, when it is expected to disclose that its bonus pot for 2014 was more than 5% lower than the previous year.
None of the banks would comment on their pay proposals.
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