Barclays executives came under fire Friday from shareholders unhappy over their generous pay packets.
Confronted by heckling and mocking laughter, the bankers defended their pay structure to a packed annual general meeting in London. One shareholder wondered why Chief Executive Bob Diamond got any bonus at all.
Diamond was awarded pay, bonus and deferred shares worth 17.7 million pounds ($28.7 million at the current exchange rate) for 2011, a year in which the chief executive said the bank's performance was "unacceptable."
The bank's chairman Marcus Agius told the shareholders that paying a zero bonus was not an option.
"We would be so far out of line with our competitors that the commercial consequences would be dire," Agius said.
Last week in response to rising shareholder pressure, the bank announced that a chunk of the bonuses to Diamond and Finance Director Chris Lucas would only be paid out if certain earnings targets are achieved. Bonus payments could lapse if the target isn't met within three years from the date of the award.
Diamond stands to lose 1.35 million pounds ($2.17 million) and Lucas 900,000 pounds if they miss the target .
Barclays says it is increasing the share of profits returned to shareholders.
"Evidently, we have not done a good enough job in articulating our case," Agius said in an opening statement.
Shareholder Jennifer Kramer responded that "the problem is with the remuneration and not with how it was communicated."
Simon Walker, director-general of the influential business group, the Institute of Directors, joined the criticism of Barclays pay structure earlier this week.
"I think Barclays, overall, is out of order and that includes Bob Diamond," Walker said. "Barclays pays three times more in bonuses to top executives than it does in total dividends to all its shareholders."
In a formal response to a government consultation, Walker said Barclays was not the only offender.
"Out of control remuneration at some FTSE companies is damaging the reputation of British business as a whole," he said, recommending that pay should be subject to approval by a majority of shareholders.