Barclays PLC cut the money it puts aside for bonuses by 23% during the first half in an effort to hit its central profitability target for 2019, the Financial Times reported.
The lender set aside £456 million in the first half — the lowest amount since 2016 — versus £593 million in the same period a year ago, the report said.
According to the newspaper, the majority of the bonus pool is used to fund annual awards for highly paid staff working at the lender's investment bank in London and New York, which is considerably less profitable than the other businesses, and not to those working in the U.K. retail division or the international payments unit.
Flat revenues at Barclays' corporate and investment bank hint that the bonus cuts goes beyond just poor performance, the FT said.
Barclays' former head of the investment bank, Tim Throsby, left because he disagreed with CEO Jes Staley over the level of bonus cuts, several people briefed on the matter told the newspaper.
"Tim was less willing than Jes to take a risk around compensation," a senior insider told the FT. The insider added that Staley believed he could make the cuts without losing top bankers, mainly due to a tough job market for investment bankers.
However, analysts are skeptical the bank will manage to hit its target due to a "challenging" first half, the report said.