Barclays chief executive Mr Matthew Barrett will stay in his post for a further three years, the bank announced yesterday after awarding him a salary package of £3.21 million sterling (€5.18 million) per year.

The lucrative contract, which is set to make Mr Barrett Britain's highest earning bank chief, also includes a £1.1 million bonus if he meets the bank's profit targets and a stock option for 500,000 Barclays shares, worth £11.3 million.

Barclays's annual report published yesterday said the contract was a one-year rolling arrangement.

Mr Barrett has also agreed to a three-year deal with a basic annual salary of £1.1 million, the bank said.

"We are delighted to have secured Matt's services for the next three years," Britain's fourth-largest bank by market value said in a statement. "His impact on this business has been immense and we look forward to his continuing work to transform Barclays into one of the world's most admired financial services companies."

The bank posted a 9 per cent rise in annual profits to £3.6 billion in 2001, but a 35 per cent rise in bad debt charges and rising costs raised doubts among investors about future growth.

Mr Barrett's total remuneration last year was £2.287 million, including a basic salary of £850,000.

Sir John Bond, chairman of Britain's biggest bank HSBC, received a total package last year of £2.5 million. Barclays said Mr Barrett's package was competitive but in line with salaries paid to executives of international banks.

The 57-year old Irish-Canadian, who joined Barclays in 1999 from Bank of Montreal, has won applause from investors for turning around Barclays's fortunes. In the years before his arrival, Barclays had made an unprofitable attempt to get into investment banking and racked up big losses in Russian bond trading.

Mr Barrett has set himself a goal of doubling Barclays's economic profit - post-tax attributable profit over and above the cost of capital - and shareholder value every four years. - (Reuters)