Anger as Barclays cuts jobs and pays bigger bonuses to investment bankers

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Anger as Barclays cuts jobs and pays bigger bonuses to investment bankers

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To cut costs Barclays is to axe up to 12,000 jobs this year – nine percent of its employees – even as it raised the bonuses paid to its investment bankers.

Britain’s third-biggest bank said it paid 2.4 billion pounds (2.9 billion euros) in bonuses last year – a 13 percent increase despite a slump in profits from the business.

The news prompted anger from trade unions and some British politicians who said the bank had not learned the lessons of the financial crisis.

“The culture change the bank promised will be less than skin deep if those at the top still hoover up obscene amounts of money while workers in call centres and branches struggle by on low wages and face the persistent pressure of job insecurity,” said Ciaran Naidoo of Unite the Union.

The opposition Labour Party’s Cathy Jamieson, who is shadow financial secretary to the Treasury, said this showed the need for a bonus tax on bankers.

Barclays Chief Executive Anthony Jenkins, defended the bigger bonus pot, saying the bank had to recruit the best staff to compete with global rivals and continued to have “constructive” talks with investors over pay.

“We need to recruit people from Singapore to San Francisco. We need the best people in the bank to drive long-term sustainable returns for our shareholders,” Jenkins told reporters on a conference call.

“I understand that there will be some (people) who feel that this decision is the wrong one for Barclays. But it is the decision of the board and myself that this entirely is the right decision for the group and in the long-term interests of shareholders,” he said.

Jenkins said banking was going through a “100-year transformation” as technology and cost pressures reshape the industry, and he was optimistic that Barclays was well set for a “pivotal” 2014.