Barclays showdown over Barrett

BANKING giant Barclays faces a showdown with major shareholders this week over its alleged failure to consult them properly before announcing a new pay package for chief executive Matt Barrett.

Eight of the company's biggest investors are furious that they were not given enough time to consider Barrett's contract before it was made public.

Sir Nigel Rudd, chairman of the bank's remuneration committee, and Cathy Turner, head of investor relations, will attempt to placate the investors.

In an attempt to keep the Irish-born Canadian at the helm, Barclays has given Barrett a three-year pay deal potentially worth £15.3 million.

Bruised by the mauling it received when Barrett was hired in 1999 on a potential £30 million deal, the bank rushed out details of his latest contract to coincide with publication of its annual report last month.

But one leading institutional shareholder-complained at being given only an hour to scrutinise details of a faxed copy of Barrett's contract, moments before it became public.

Another shareholder told Financial Mail that he had a meeting with the bank's chairman, Sir Peter Middleton, the day before the announcement and was assured the contract had not been signed.

'We are not necessarily opposed to what they are paying Barrett - he seems to have done an OK job,' said one shareholder.

'But the way they have handled the consultations indicates the bank has no sense of risk control - they simply don't seem to have any idea of what is likely to inflame public or shareholder opinion, and that is worrying.'

Barclays was accused of insensitivity two years ago when it closed hundreds of local branches, sparking nationwide outrage.

Barrett was also the architect of a deeply unpopular scheme to charge bank customers £1 to use cash machines, which was later dropped.

Some shareholders have been particularly angered because they felt relations with Barclays had improved after the initial furore over Barrett's appointment and the branch closures fiasco.

One shareholder told Financial Mail at the time the latest package was published: 'It looks as though Barclays has reverted to type - a cynical reaction would be to conclude

that they are trying to hide something.'

Barclays said the bank had consulted major investors before announcing Barrett's package. 'We heard them express confidence in Matt and we were pleased we could be transparent about his contract.

'We have met before with some of the investors we are seeing on Thursday but we are happy to see them again to talk over the details.'