Barclays is planning a radical pay overhaul as part of a strategic review that could also see the group shed staff, the Financial Times said yesterday.

Barclays’ incoming chief executive, Bob Diamond, aims to use contingent convertible bonds — so-called CoCos — to pay a large proportion of the bonuses of more than 1,000 of its top bankers, the newspaper said in an early copy of today’s edition, citing unnamed sources close to the plans.

The FT said bankers, not otherwise identified, told it that the lender is also planning to announce a review of its operations, with Diamond likely to extend cost-cutting at its investment banking arm, Barclays Capital, across the group. Diamond also plans to reshuffle some senior management roles, the FT said without elaborating.

Barclays, one of Britain’s “Big Four” banks, is set to announce the pay plan with its annual results in mid-February but still needs to secure regulatory approval from the Financial Services Authority.