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Barclays is proposing to overhaul how it pays its chief executive CS Venkatakrishnan in a move that would slash his fixed pay but hand him £9mn if the lender hits its profitability targets.
The British bank wrote to investors this week outlining plans to change how it pays Venkatakrishnan and the group’s finance director Anna Cross, according to a person familiar with the matter.
The changes, if approved, would see Venkatakrishnan’s fixed pay cut from £2.95mn to £1.59mn, but the former JPMorgan executive would become eligible for bonuses and long-term stock options worth up to eight times his new salary, the person said.
They added that Venkatakrishnan, known as Venkat, would receive about £9mn if Barclays achieved its previously stated target of a return on tangible equity — a crucial measure of bank profitability — of 12 per cent by 2026.
His maximum earnings would be capped at just over £14mn, but he would only be awarded this amount if Barclays achieved a return on tangible equity of more than 14 per cent, the person said.
Venkatakrishnan’s total remuneration came to £4.64mn for 2023, down from £5.2mn a year earlier.
The move, which was first reported by Sky News, comes after Barclays last year became the first British lender to scrap the banker bonus cap imposed by the EU, following the UK’s 2023 decision to remove the limits in a post-Brexit boost to the City of London.
At the time, Barclays told staff that it would set bonuses for its most senior employees, so-called material risk takers, at up to 10 times their fixed pay, while keeping base pay the same.
Under the bonus cap, which was introduced across the EU in 2014 in the wake of the global financial crisis, bonuses were capped at two-times base salary.
Venkatakrishnan has been a rare vocal supporter of chancellor Rachel Reeves, who frustrated many business leaders by increasing taxes by £40bn in October’s budget and has so far struggled to revive Britain’s flagging economy.
Speaking at the World Economic Forum in Davos on Tuesday, Venkatakrishnan said there was “a lot to be optimistic about in the UK”, including its financial sector. Reeves has also attended the forum in a bid to woo business leaders and foreign investors.
Barclays said that its remuneration committee “meets with stakeholders throughout the year to gather feedback on our remuneration policy”.
“Whether or not the committee chooses to propose any change to our current directors’ remuneration policy in 2025, the policy will continue to focus on rewarding sustainable performance, and close alignment with shareholders’ interests.
“The committee will publish their views and decisions in the 2024 annual report on 13 February.”
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