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Bob Diamond Nets £2m Barclays Pay-off

(c) Sky News 2012

Barclays (LSE: BARC.L - news) has agreed a payoff for Bob Diamond, its former chief executive, worth approximately £2m, the bank's chairman has confirmed.

Confirming a report by Sky News, Marcus Agius told MPs (BSE: MPSLTD.BO - news) that Mr Diamond had waived share awards worth up to £20m. A statement by Barclays added that "consistent with his contract of employment, Mr Diamond will receive up to 12 months' salary, pension allowance and other benefits". People close to the bank said that this would amount to a package worth approximately £2m.

The size of the payoff is expected to appease shareholders who had been calling on the bank to pay Mr Diamond the minimum possible under the terms of his contract. It is, however, unlikely to satisfy some senior politicians who had been calling on Barclays to cancel any payout to its former chief executive following the Libor-rigging scandal which has cost Mr Diamond, Mr Agius and Jerry del Missier, chief operating officer, their jobs.

Mr Diamond is estimated to have earned well over £100m during his career at Barclays, and was asked by board members last week to forego his entitlement to up to £20m of unvested share awards.

Mr Diamond said: "For the past 16 years I've had the honour of working at Barclays. The wrongful actions of a relative few should not detract from the outstanding work that Barclays employees carry out each day on behalf of clients and customers around the world. It is my hope that my decision to step down and today's agreement on my remuneration will help close this chapter and allow Barclays to move forward and prosper."

Mr Agius's hearing before the Treasury Select Committee included a series of testy exchanges during which he was quizzed about Barclays' relationship with the Financial Services Authority (FSA).

Shortly before the hearing, the Committee released correspondence between Mr Agius and Lord Turner, FSA chairman, which revealed the regulator's concern about the bank being "not fully transparent" and "seeking to 'spin' its messages in an unhelpful fashion" in relation to its capital strength.