Remember when Barclays increased investment bankers’ bonuses even as profits fell?
It went down pretty badly with investors when the 2013 results were announced back in February.
At the time chief executive Antony Jenkins could only say that he had to pay more so that staff would stay at Barclays instead of jumping ship to American rivals.
That decision sat pretty awkwardly, to say the least, with the decision to cut investment banking jobs – today the number was set at 7,000 over the next three years.
So why is Barclays paying staff to stay, then telling them to go?
At last Jenkins has come out with the full story.
“I knew what none of you knew at the time that we were going to make this very significant transition,” Jenkins said today.
“In the transition we need to protect the people who are valuable to the franchise, that we need for the business, and that is what we spent the money on, that is what we invested the money in and that is the right decision to get us through the transition period.”
So there we have it – good bankers get paid more, bad bankers get fired.
It is just what you would want, and investors like it today – Barclays’ share price is up 6.8 per cent so far.
Perhaps it is a shame Jenkins could not give the full story to the rowdy shareholders at the AGM last month. It could have saved him a lot of pain.