Amid an ongoing storm of public anger over banker pay, Barclays PLC shareholders Wednesday fired angry questions at the bank's executives at its annual general meeting and registered a near-10% vote against approving the 2010 remuneration report.
Shareholders voted 9.66% against the pay report, which included the award of a £6.5 million 2010 bonus to chief executive Bob Diamond. There was also discontent with changes to the bank's long-term incentive plan for executives, with a 10.98% vote against approval.
According to data from corporate governance advisory Pensions & Investment Research Consultants Ltd., or Pirc, the figure was far higher than the average 5.6% shareholder vote against approving remuneration reports at FTSE 100 companies last year. Barclays in 2010 recorded a 6.28% vote against its report, up from around 4% in 2008.
The issue of pay, and Barclays' rationale for awarding bonuses, dominated investor questions at the bank's AGM earlier Wednesday, with several shareholders complaining that their dividends are just a fraction of employee payouts and that their shares are still worth far less than before the financial crisis.
Barclays in 2010 paid out £670 million in shareholder dividends, and around £11.9 billion in staff costs, including bonuses. In 2007, before the financial crisis took hold, dividends came to £2.2 billion and staff costs including bonuses were £8.4 billion.
Banker pay has been a hot topic in the U.K., where many people see it as a root of the financial crisis that led to some of the country's largest banks falling into part government ownership. Barclays didn't receive any direct state support.
"I've been a shareholder for 50 years and don't feel I've been treated fairly in sharing the pain," private shareholder Trevor White told the bank's board at the AGM. "The shares have plummeted, the dividend is 20% of what it had been, while the high earners are back to where they were," he said.
Chairman Marcus Agius argued that Barclays, and particularly its Barclays Capital investment banking arm, must compete with its rivals on pay in order to get the best people and boost profits. He sought to reassure shareholders that the bank plans to raise dividends but that it first needs more clarity on the regulatory picture.
"We are very focused on a progressive dividend policy. We want to see returns to shareholders -- goodness knows they deserve it," he said.
Coming international regulations known as Basel III require banks to hold more capital against their assets. U.K. authorities have said U.K. banks may need to hold additional capital, while large, global banks deemed systemically important or "too big to fail" are also likely to be told by international regulators to hold excess reserves.
The AGM was held just hours after Barclays reported a 9% decline in first-quarter pretax profit amid a sharp fall in revenue at its investment banking unit.
Pretax profit in the three months to March 31 was £1.66 billion, compared with £1.82 billion in the first quarter of 2010. Net profit was £1.01 billion, from £1.067 billion.
Margot Patrick is a reporter for Dow Jones. Write to her here.
This story originally appeared on Dow Jones Newswires.