Barclays hikes CEO pay to £15m because it reviews enormous rise in earnings

Barclays has hiked its chief executive’s pay packet to £15million after reporting soaring profits. 

The lender cut chief executive CS Venkatakrishnan’s fixed pay, but boosted his bonuses from £8.5million to £12.7million. 

It comes as Barclays vowed to hand £15billion back to its shareholders over the next two years as it continues to slash costs and boost profits.

It plans to return capital through buybacks and dividend payouts, and will launch a £1billion share buyback scheme after its fourth-quarter earnings beat expectations.

Pre-tax profits increased from £1.7billion to £1.9billion in the fourth quarter, bringing annual profits to £9.1billion, ahead of estimates.

‘Our progress in the past two years provides a strong foundation to deliver more for our customers,’ said chief executive CS Venkatakrishnan. 

‘Our aim is to secure sustainably higher returns through to 2028 and beyond’.

Barclays, which announced its cost cutting plan in 2024, said it had made savings worth £700million last year, bringing the total to £1.7billion over two years.

Barclays beat expectations in the fourth quarter and will launch a £1bn buyback scheme 

Group income rose 9 per cent to £29.1billion, with net interest income, excluding the investment bank and head office, of £12.8billion, beating expectations.

This was primarily driven by the corporate bank, which saw income soar 16 per cent ‘reflecting higher average deposit and lending balance’, while income from the investment bank jumped 11 per cent.

This helped to offset softer performances within its UK and private bank and wealth management divisions, and higher operating costs, which jumped 6 per cent to £17.7billion.

It said it had booked a £235million charge for motor finance redress in the third quarter and has a provision of £325million as at 31 December.

Its return on tangible equity was 11.3 per cent with every division delivering double-digit returns, the bank said.

The £1billion share buyback, which is expected in the first quarter, follows total buybacks of £2.5billion last year and a total dividend of 8.6p. 

Barclays said it planned a £2billion dividend for 2026.

Shares in Barclays rose 1.62 per cent to 494.45p at the open. 

Max Harper, analyst at Third Bridge said: ‘The bank’s progress toward its 2025 targets is encouraging. 

‘Income is growing steadily, supported by the structural hedge bolstering NII and the market environment driving non-NII growth, alongside strategy. 

‘However, there are still gaps in the strategy. NatWest’s acquisition of Evelyn Partners represents a missed opportunity for Barclays; our experts continue to highlight the bank’s relatively weak UK wealth proposition as an area where a bold move could have driven rapid growth.’