“At least you are then rewarding them for what you know in terms of the value they have created.” As the industry is dominated by high-paying US banks, however, he expects to keep paying bonuses in the current model. As a result, Barclays will have to cut jobs rather than pay as it tries to save money. “I don't think we can pay people less than the market price, and that implies that if you want to control costs, you want to operate with as few people as possible,” he said. Mr McFarlane refused to comment on whether or not he is hiring former JP Morgan executive Jes Staley as Barclays’ new chief executive. But when asked about the implications of hiring an investment banker for the top job, he denied that Mr Staley is an investment banker by trade. “He is not an investment banker. He started life like me, as a commercial banker, he is a corporate banker,” said Mr McFarlane. “He then ran the equities division, but he didn't trade equities. He ran the fund management division, and then ran the investment banking. He is a client guy, like I started life, lending money to corporations.” Barclays’ executive chairman also warned that the sustained flood of fines and the steady tide of regulation could hit bank lending and undermine the wider British economy. “I'm worried about the real economy effect of all of this. Years and years after the crisis we are still pushing water uphill in terms of increased regulation,” he said. “If we can't [move on from historic problems] then other countries will, and we will be relatively disadvantaged.”
Barclays' Chairman, Mr McFarlane, has attacked the banking bonus culture, stating that it encourages people to "cut corners', adding that his comments may cause alarm amongst his staff. He added that bonuses were "a model that was imported from the US and seems to suit those (US) institutions". He believes that Barclays would not be able to "act alone" in tackling the bonus culture for fear of losing its best employees and called for "some sort of industry-wide solution".