Barclays bonus culture criticised by MPs, Sir John Sunderland grilled

Written on:January 31, 2013
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London Barclays bank

Sir John Sunderland, chairman of Barclays remuneration committee, appeared unapologetic of PPI scandal

Just a day after Barclays was slammed for hefty pay package and bonuses for its chief Antony Jenkins and staff, MPs have launched an attack over the bank that was ridden in multiple controversies last year such as Libor rigging and PPI mis-selling. Barclays remuneration committee chairman Sir John Sunderland was grilled by a committee of MPs for the bank’s bonus culture, which saw heavy pay packages and bonuses being awarded to the ill-famed ex-chief Bob Diamond during his time as the bank’s CEO.

Andrew Tyrie, who chairs the Parliamentary Commission on Banking Standards, described Sir John Sunderland’s defence of the generous bonuses awarded to Barclays former chief executive Bob Diamond as “unrepentant” and “absolutely extraordinary”. John Sunderland said that he did not regard Bob Diamond’s £2.7m bonus award for 2011 as “a profound mistake”, insisting that the former chief executive had led the bank “with great energy, enthusiasm and skill” and that he “deserved some recognition”.

The parliamentary commission is reviewing banks’ behaviour, and Barclays in particular, following its £290m fine for Libor rigging scandal. Bob Diamond, who resigned last summer in the light of the scandal, was one of the best-paid bankers in London. His successor, Antony Jenkins, has resolved to reinvent Barclays’ damaged image. Several members of the committee pointed out that unless Barclays implemented minimal bonus payout, the bank’s claims of reviving its culture would ring hollow.

Challenged on Barclays’ mis-selling of payment protection insurance (PPI), Sir John Sunderland appeared unapologetic, prompting an outburst from one committee member, Lord Turnbull. “This is just rubbish”, said Lord Turnbull, in response to Sir John’s defence of PPI sales practices over 20 years.

Alison Carnwath, predecessor of Sir John Sunderland, told the commission that Bob Diamond was reluctant to accept that pay was high, adding that he “thought he found loyalty in people around him by paying them a lot of money”.

     

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