Diamond not Barclays’ top earner with £6.3m
It's bank bonus disclosure day.
Barclays has kicked it off with the publication of its report and accounts, showing that its chief executive Bob Diamond received £6.3m for his performance in 2011, including a bonus of £2.7m, and its highest paid executive - who hasn't been identified - received £6.7m (and another unnamed banker was awarded £6.5m in total).
As ever with the remuneration of top bankers, there's nothing simple about this. On top of Mr Diamond's reward for 2011, the accounts also show he received a one-off £5.7m benefit, which relates to a tax liability that was created for him when he moved back from the US to the UK to take over as chief executive of Barclays.
I am told this is mostly due to the crystallisation of a capital gains tax charge crystallised in the UK by his relocation to the UK - and all of the money goes to tax authorities here and in the US.
Another wrinkle is that although Mr Diamond has been awarded the opportunity to earn £6.75m from the group's long-term incentive plan, Barclays values this LTIP award at just over £2.2m - on the assumption (based on historic performance) that ultimately his performance will only see him receiving a third of the potential payout.
Some analysts will definitely therefore argue that Barclays is understating what Mr Diamond and others may end up earning.
None of Barclays top bankers will get any of their bonuses this year. They will have to wait a year to get any actual payments, which will be paid in tranches over three years. Bob Diamond will not receive anything in cash, and nor will the group's finance director Chris Lucas.
Other top executives will receive some of the bonus in cash.
Anyway, later today we will also get the rewards of the top bankers at the partly nationalised Royal Bank of Scotland and Lloyds.
UPDATE 12:50 GMT
Here is some of the context for judging the rewards for Mr Diamond and his colleagues.
For owners, one of the most important measures of a bank's success is the return that it makes on the capital or equity they've invested in the business. It is a measure of how well they are being rewarded.
Banks can boost these returns in a dangerous way by recklessly increasing how much they lend relative to this capital, which is what happened in the boom years. But these days banks, bitten by the bust of 2008, are trying to increase this return on capital by cutting costs and widening the spread between their own costs of funds and what they charge for loans (though, in a low-interest world where there is huge competition for deposits and not that much demand for loans, they are finding this tricky).
Anyway Barclays' return on average shareholders' equity last year was 5.8% - down from 7.2%. So the rate of return for Barclays' owners declined. Barclays, on this fundamental yardstick, saw a deterioration in performance.
What was the equivalent performance at HSBC? Well at that rival of Barclays the return on average ordinary shareholders' equity was almost twice as good, at 10.9% - and the return on equity rose in 2011 from 9.5% in the previous year.
On that basis, the owners of these two banks would feel more satisfied with HSBC than with Barclays.
Even so, many would say that the boss of HSBC, Stuart Gulliver, was handsomely rewarded for this outcome. He was paid a salary of £1.25m, a bonus of £2.16m plus longer term incentives, which he can pocket over five years, worth £3.75m - or £7.16m in total.
In other words, his rewards were a bit better than Mr Diamond's, for results that seem significantly superior to Barclays'.
But how does it look when you judge those rewards in relation to the maximum both executives could have earned.
In terms of the longer term reward, it is impossible to make a direct comparison, because what Mr Gulliver ultimately receives from this scheme is not subject to his performance over the next few years, whereas what Mr Diamond eventually pockets is subject to ongoing evaluation of his performance.
But it is possible to compare bonuses: Mr Gulliver was awarded 57% of the maximum bonus he could have been given and Mr Diamond received less than a third of his maximum entitlement.
So arguably Mr Gulliver has had superior rewards for superior performance. It will be interesting to see whether owners believe the differential is wide enough.
Of course, there are others, like the leader of the Labour Party, Ed Miliband, who have an altogether different concern about Mr Diamond's rewards.
He queries whether any boss of a bank like Barclays should be earning so much, prior to reform of the banking system which would remove the implicit subsidy and support that all big banks receive - in the form of the de facto promise from the state, from taxpayers, that said big bank will be rescued if it gets into serious difficulties.
The argument goes that bankers should not be paid like entrepreneurs, big money for taking risks, if in fact those risks are not really being taken by them and by the banks' owners - but by taxpayers (because when it all goes wrong at a bank, the bill falls on the state, in a way which isn't true of most other businesses).
Some bankers, like the chairman of RBS, Sir Philip Hampton, acknowledge the force of this argument. He would point out however that he has to hire and retain bankers in the market that exists, not the one he would like to exist. That market is an international one, he would say, in which top bankers can command enormous pay packages (a bit like footballers).
So unless he wants to staff his organisation with lower paid mediocrities, he has to pay something like the going rate - even if that going rate, on some perspectives, is excessive.
Developing that theme, a leading City figure, Michael Spencer, founder and chief executive of the world's biggest moneybroker, ICAP, has told me he thinks it would be disastrous for the City and the British economy if - in his words - senior bankers at Barclays and RBS were hounded by political and media pressure into abandoning their bonuses and longer-term rewards.
He believes that if the lobbyists against big pay for bankers were to win, there would be sustained long-term damage to the UK's financial services industry - which generates substantial and important tax revenues and overseas earnings for the UK - because a powerful message would be sent out that London is not a place to work if you are looking to make big money for yourself.
Which is certainly a view I have heard widely in the City. But it would only be a substantial risk to London's ability to retain and recruit top talent if those who work in finance around the world don't themselves make any distinction between financial firms like banks, that receive taxpayer protection, and those like hedge funds, private-equity firms, money manager outfits and so on which stand or fall on whether they do the job properly.
UPDATE 16:00 GMT
It is hideously difficult to compare remuneration at the different banks, because they have such different approaches to how they incentivise senior executives and what they regard as this year's pay rather than rewards for future years or past years.
So, for what it's worth, Lloyds - which doesn't have a proper investment bank - says the top reward for an executive below board level was £2.8m, and there were five senior executives below the board who earned more than £2m.
As for the chief executive, Antonio Horta-Osorio, it had already been announced that he was waiving his entitlement to a bonus (remember he had to take a leave of absence at the end of last year to recuperate from extreme exhaustion).
But his salary is just over £1m and he has been awarded an entitlement to shares under a long-term incentive scheme that could be worth £3.3m - but if it were assessed in the way that Barclays values its equivalent schemes, it would be worth around £1m, and if the RBS valuation were applied, it would be worth £1.5m.
So let's split the difference and say that Mr Horta-Osorio's package is worth roughly £2.3m in total (that's salary and long-term investment plan).
Over at Royal Bank of Scotland, it is even more complicated.
The chief executive, Stephen Hester, waived his bonus in January in the face of extreme political and media pressure.
His salary is £1.2m and his long-term investment award is worth a maximum of £3.6m but £1.6m at RBS's valuation - so arguably his package is £2.8m.
The head of RBS's investment bank, John Hourican, is receiving a bonus of £2.5m - which may be seen as controversial because he has also just been awarded 15.9m shares worth £4.2m in respect of a signing-on deal he did when taking the job in 2009 (so it would probably be wrong to include this £4.2m in a calculation of this year's rewards, even though he has just received the shares).
Mr Hourican has waived his entitlement to any participation in this year's long-term investment plan.
The highest paid banker at RBS is Ellen Alemany, who runs RBS's US operations. In a male dominated banking industry, it is striking that at RBS the best paid individual is a woman. Her package was worth £4.7m.
The broad message out of RBS - owned to the tune of 82% by taxpayers - is that the rewards for its top team are not a lot more than half what Barclays pays. So I am sure that the government will argue that the bank has responded to pressure from ministers to pay the minimum needed to retain the executives it regards as essential.
That said, there are still plenty of people who don't think any banker should earn millions, whether they work for a semi-nationalised bank, or a bank big enough to be rescued by taxpayers were it to get into difficulties.