Bonus war: Barclays £2bn vs RBS £1.3bn
It's not often that Barclays does a favour to Royal Bank of Scotland.
But in deciding to pay something over £2bn in bonuses to its investment bankers, it will provide helpful "context" for Royal Bank of Scotland to award around £1.3bn to executives in its global banking and markets division.
On Tuesday we'll learn that Barclays is paying out around £4.5bn in total remuneration to the 22,000 investment bankers employed at its investment bank, Barclays Capital.
So average pay for Barclays Capital's 22,000 people will emerge at around £205,000 - or marginally more than the annual pay of the prime minister, and about a third less than average pay for a Goldman banker.
And something under half of this will be in the form of bonuses (though Barclays may not put the precise size of the bonus pool into print).
Meanwhile semi-nationalised Royal Bank of Scotland has more-or-less agreed with UK Financial Investments - steward of taxpayers' controlling 84 per cent stake in the bank - that it will pay out £1.3bn in bonuses to its bankers.
For the avoidance of doubt, there has not yet been a formal sign-off of RBS's bonus awards by the Treasury and 10 Downing Street.
But my sense is that the Chancellor will ultimately approve them.
So if you're a banker, you'd probably say "well done, Barclays" and "hard cheese, RBS".
Anyone else might well say "crikey" or something unprintable - because these are substantial rewards being doled out only a year and a bit since the banking industry was rescued with enormous loans, guarantees and investment provided by taxpayers.
Both Barclays and RBS will say that they are responding to the public's mood of unease about huge payments being made to their staff - and are showing "restraint".
Thus the ratio of investment banking remuneration to Barcap's revenue has been deliberately reduced by management from 44 per cent in 2008 to 38 per cent last year.
And at RBS, that ratio will be nudged even nearer to 30 per cent.
The benchmark is the world's most successful investment bank, Goldman Sachs, which paid out 35.8 per cent of its net revenues in the form of compensation and benefits for its stellar performance in 2009.
However the relevant background for assessing the supposed sacrifice bankers have made in cutting the ratio of rewards to revenues is that the past 12 months have seen a return to boom conditions.
At Barclays Capital, for example, total income rose almost 80 per cent in the first half of 2009.
So actual pay in absolute terms for most investment bankers will rise for their 2009 performance compared with 2008, even if they pocket a lower proportion of the income they generated.
For many it will be one of the best years ever for pay, beaten only by the last year of the bubble, 2007.
What's more, many would say this boom in revenues was a direct result of the emergency measures taken by governments and central banks to rescue the global economy from a mess caused in large part by the bankers themselves (as one instance, when interest rates are cut by central banks to almost zero, companies pay big fees to investment banks to refinance themselves at these lower rates).
Here are a few other relevant points:
1) Barclays will announce an enormous profit for 2009 while RBS discloses another whopping loss - so most would say that bumper bonuses look more incongruous at lossmaking RBS (although its losses would have been even more spectacular without the huge income of its global banking and markets division);
2) At both Barclays and RBS, top people will be paid in shares rather than cash, which does less damage to the banks' balance sheets and - in theory (if not always in practice) - discourages executives from taking crazy risks to generate immediate profits.
3) At both banks, receipt of most of the bonuses for most executives will be in a series of tranches over three years - with the ten most senior executives at Barclays receiving nothing for their 2009 performance till 2011.
All that said, the experience for employees in much of the private sector in 2009 was flat or declining basic pay coupled with lower or zero bonuses. So Barclays and RBS probably can't expect most British citizens to celebrate the improved fortunes of their senior staff.
UPDATE 14:31 Barclays tells me that Barclays Capital in fact employs 23,000, so pay per head is in fact £196,000 - or a tiny bit less than what the prime minister earns.
So that's alright, then.