Former Barclays chief executive Bob Diamond will give up bonuses worth £20million (NZ$40m) after resigning over a rate-rigging scandal, the bank's chairman said on Tuesday (local time).
But chairman Marcus Agius told British lawmakers investigating the scandal that Diamond, whose pay packages during the financial crisis were fiercely controversial, would still receive a final pay-off of around £2m (NZ$4m).
"Bob Diamond has voluntarily decided to forego any deferred consideration and any deferred bonuses to which he would otherwise have been entitled," Agius told parliament's Treasury Select Committee.
"The maximum amount would be 20 million," he said.
Diamond and Agius both resigned last week over revelations that Barclays traders attempted to manipulate key inter-bank lending rates, but Agius is staying on to lead the search for Diamond's replacement.
Barclays was fined £290m (NZ$566m) last month by British and US regulators for the attempted rigging of the Libor inter-bank lending rate and Euribor, its eurozone equivalent.
When asked about what US-born Diamond, who only took over at Barclays chief executive in January 2011, would receive in terms of salary, pension and other benefits, Agius told the said "it comes to around 2 million."
In a separate statement, Barclays said Diamond, 60, would still receive up to 12 months' salary, pension allowance and other benefits.
Diamond had "voluntarily offered to waive all of his unvested deferred bonus awards and long term incentive share awards," it said.
"This is in addition to his previous decision to forego any consideration for an annual bonus this year."
The bank added that Diamond has also agreed to give up his contractual entitlement to tax equalisation.
"Despite having no personal culpability, he recognises more than anyone the negative attention that they have generated and has taken characteristically strong action to address that," Agius said of Diamond in the statement.
Diamond himself wrote: "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."
Diamond was one of the world's highest paid bankers, earning a package worth £17.7m (NZ$35m) last year, and drew the admiration of many in the industry for making Barclays a global player in investment banking.
But his payouts became a symbol of banking's bonus culture, which became deeply unpopular with the British public during the economic downturn.
Agius told lawmakers that Barclays was working to reduce its levels of executive pay - a hot political issue in Britain - but said it was "simplistic" to suggest that pay could come down faster.
"If we reduce the payment of our staff too fast, they leave," he told the committee.