Barclays pays out £2m to beef up board

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Barclays, the UK's third-largest bank, is to pay its four new board directors a total of £2m in salary as part of a boardroom reshuffle that took effect yesterday.

The company said that its four new divisional heads will be paid £500,000 apiece, just £200,000 shy of the £700,000 salary that its new deputy chief executive, John Varley will receive. Formerly finance director, Mr Varley has been named as Barclays' next chief executive when Matt Barrett moves up to become chairman a year from now.

Barclays said yesterday that it was releasing the remuneration details earlier than legally required in order to comply with corporate governance best practice. The arrangements would have to be disclosed in the annual report in the spring.

The bank is already braced for a storm at its annual meeting over the plan to bump Mr Barrett up to part-time non-executive chairman, in defiance of the Higgs code on corporate governance which favours an outside appointee for the position of chairman. The appointment of four new executive directors will be seen as an attempt to bolster the board and dissipate shareholder concerns.

Naguib Kheraj is moving up from chief executive at Barclays Private Clients to succeed Mr Varley as finance director. Roger Davis joins the board as head of UK banking, in a restructuring that brings all the personal, business and high-net-worth customers under his control.

Gary Hoffman, the head of Barclaycard, is being given a seat in the boardroom, and David Roberts, previously head of personal financial services, began his new job yesterday as chief executive of Barclays Private Clients and international banking. All four will report to Mr Varley.

The arrival of the new board members takes effect at the same time as the promotion of Chris Lendrum, an executive director, to vice-chairman.