1/30/2012 2:05 AM ET
(RTTNews) - Certain major shareholders of British banking group Barclays Plc (BCS: News ,BARC.L: News ) have reportedly warned the bank that they will not accept paying higher payouts to its senior investment bankers, including its chief executive Bob Diamond.
The investors have urged the company's board to end its lavish bonus culture. A report from FT stated that the public outrage follows Royal Bank of Scotland Group Plc's (RBS: News ,RBS.L: News ) decision to pay its chief executive Stephen Hester nearly 1 million pounds bonus for the year 2011, besides his salary of 1.2 million pounds.
Last week, there were reports that the chairman of Royal Bank of Scotland Sir Philip Hampton has decided not to receive his signing-on bonus worth as much as 1.4 million pounds or $2.20 million, putting pressure on the bank's chief executive officer Hester to do the same.
Some of the big shareholders were of the opinion that banks should moderate their pay hikes to match sharp falls in shareholder returns. In addition, the declining revenues of the companies have made the shareholders concerned about the rise in salaries and staff costs.
The report added citing one fund manager that revenues earmarked for expenses has also risen to unacceptable levels.
News of the bonus award for Hester has evoked criticism in the UK on concerns that the bonus is too big amid the country's economic difficulties. However, the UK government has reportedly said it will not block the bonus for Hester.
Other politicians in the UK have called for Hester's bonus to be blocked or reduced, as the bank is still owned by taxpayers and as it recently announced plans to cut 3,500 jobs.
BCS closed Friday's regular trading at $14.09, up 1.15 percent on the LSE.
BARC.L ended on Friday at 222.85 pence.
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by RTT Staff Writer
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