Barclays lifts cap on bonuses for bankers in UK

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Andrew Feinberg

White House Correspondent

Barclays has changed its pay policy to allow its top bankers outside of the European Union (EU) the chance to earn up to 10 times their base salary in bonuses.

The move will include the UK bank, after financial regulators last year decided to remove a cap that limited the amount bankers could take home in annual payments.

The post-Brexit decision meant UK banks no longer had to follow EU rules.

Barclays expects some 1,600 employees globally to be affected by the change, known as its “material risk-takers”.

Those members of staff will be able to earn up to 10 times their fixed salary in variable pay, which includes bonuses.

Previously, the cap was set at twice the level of fixed pay.

The bank said the change will give it more flexibility when it comes to setting individual bonuses within a small pool of staff, and make it a more competitive place to work.

The change brings Barclays in line with the policy set by investment bank JP Morgan, amid efforts to attract top bankers.

A spokesman for Barclays said: “The revised bonus cap will not alter the way Barclays sets its incentive pool, which is based on overall group performance.

“It will allow us greater flexibility to differentiate individual bonuses within a small and defined group of colleagues, enabling Barclays to continue to compete effectively to retain and attract the best talent globally.”

The incentive pool refers to the total amount set aside for performance-based pay such as bonuses.

In a memo sent to staff, the bank said the new bonus cap “should not change colleague expectations around total compensation”, which will not automatically increase.

Staff affected by the change will also not see their salaries cut as a result.

Material risk-takers within the EU, incorporating Ireland, will continue to have bonuses capped at twice their salary.