* Barclays: 34 pct of investors oppose or withhold vote on
* Big investor Standard Life votes against 2013 pay
* Chairman Walker says bank was losing people critical to
* Barclays says Q1 profit down after fixed income revenues
* Barclays shares up 1.1 pct
(Adds vote results, comments from shareholders, chairman)
By Steve Slater and Matt Scuffham
LONDON, April 24 More than a third of Barclays'
investors declined to back its pay policy on Thursday,
tipping the British bank into an open row with one of its
In a rare gesture of public opposition, Standard Life
said it had voted against Barclays' decision to pay out 2.4
billion pounds in bonuses for 2013 - a 10 percent increase on
2012 despite posting profits a third lower.
"We are unconvinced that the amount of the 2013 bonus pool
was in the best interests of shareholders," said Alison Kennedy,
governance & stewardship director at Standard Life, which has a
1.9 percent stake in Barclays. The decision had damaged the
bank's reputation, she added.
The vote, while a slap in the face for the bank, means it
can still go ahead and pay staff bonuses worth up to twice their
salaries. Overall 24 percent of shareholders who voted opposed
its remuneration report. Including withheld votes the share of
investors failing to back its pay policy was 34 percent.
The head of Barclays' remuneration committee John Sunderland
said Standard Life - the bank's sixth largest shareholder -
should have raised its concerns earlier in private discussions
it had over pay.
Chairman David Walker told reporters: "There was a bit of
irritation that some of the concerns (Standard Life) expressed,
they didn't express at an earlier stage... When you get a
broadside at a late stage in the process it may be too late."
Walker said Barclays' pay plan was the right decision, in
order to halt an exodus of senior staff. Last year the bank lost
people in its U.S. investment bank arm that were critical to its
development, he said, because it had cut bonuses too sharply in
2012 and last year U.S. rivals had increased pay by at least 15
In the middle of last year Barclays' profitable U.S. bond
trading desk faced losing its co-heads and more than two-thirds
of the senior team, Walker said, while overall the resignation
rate for senior Barclays employees in the United States almost
doubled in 2013.
"It would not have been in the interests of shareholders if
significant parts of the investment bank were allowed to wither
on the vine because we had lost and failed to replace
significant teams of people, in particular in the United States
last year," Walker said.
But other shareholders were unconvinced, saying pay levels
did not reflect current performance.
"We're paying for Manchester United but we're getting
Colchester United," said Phil Clarke, a private shareholder.
Barclays' pay decision adheres to new European Union rules
limiting bankers' bonuses, but may prompt closer scrutiny from
the UK government.
British Business Secretary Vince Cable this week wrote to
banks and other big companies warning them to rein in excessive
executive pay or face tighter rules. His said banks, and
Barclays in particular, needed to address "dangerous levels" of
DROP IN REVENUE
Barclays said its first-quarter profit fell after a
"significant" drop in revenue from its investment bank's
fixed-income operations, extending an industry slump across that
A cost-cutting program was starting to show a "material
benefit", however, and would help offset the drop in investment
bank profits, the bank said.
Barclays said it would report a "small reduction" in
adjusted pretax profit compared with a year ago when it
publishes first-quarter results on May 6.
Barclays' Chief Executive Antony Jenkins is reviewing the
size and shape of Barclays' investment bank and will unveil
details of his plan on May 8. He is expected to axe thousands of
jobs to cut costs and improve returns.
Tougher regulations have made many areas of investment
banking less profitable. Many bankers and analysts say the drop
in fixed income, credit and commodities (FICC) revenues is
permanent and banks need to take more aggressive action to
shrink their businesses.
U.S. rival JPMorgan reported its FICC revenues fell
21 percent in the first quarter from a year ago, while Goldman
Sachs reported an 11 percent drop and Citigroup
posted an 18 percent fall.
Barclays could cut as many as 7,500 staff, mainly by
shrinking its European fixed-income business, Bernstein analyst
Chirantan Barua estimated this week.
Barclays said its equities and investment banking advisory
businesses in the first quarter performed broadly in line with a
Barclays shares were up 1.2 percent at 251.8p by 1515 GMT,
outperforming a slightly higher European banking index.
(Editing by Sophie Walker)