Barclays could have a new bonus strategy
TEXT OF STORY
STEVE CHIOTAKIS: The giant British bank Barclays is reportedly planning a radical new way to pay bonuses. Analysts say it could reduce risky banker behavior — and even cut bankers’ pay.
From London, Marketplace’s Stephen Beard reports.
STEPHEN BEARD: Barclay’s won’t confirm the story but the Financial Times claims today that the bank is planning to pay its top staff a large part of their bonuses in the form of a special credit. If the bank get into trouble the credit become virtually worthless. This method — it’s hoped — will encourage staff to run the bank in a sustainable fashion. Staff would only be able to cash in their bonds after an extended period. And that — says banking analyst Ralph Silva — should have an impact on bankers’ overall pay:
RALPH SILVA: That should bring overall compensation levels down because people are less prone to move back and forth.
Silva believes that if the regulators approve Barclays new system it could be adopted by many other big banks around the world.
In London this is Stephen Beard for Marketplace.
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