Barclays kicks off the bank reporting season tomorrow and, if all the chat is to be believed, the cash element of bonuses for its wealthy traders will be slashed in favour of deferred payments.Investment arm Barclays Capital, until recently run by chief executive Bob Diamond, is thought to have cut its bonus pool by 15%, or £400m, to £2.3bn.There had been speculation the bank would pay out 1,000 of its most senior bankers in contingent convertible bonds, often referred to as 'cocos'.But instead, staff are likely to receive 20% of their bonus in cash, 30% in deferred cash and 50% in shares locked in for three years. A clawback clause means the deferred cash payments will only be made if the bank's core Tier 1 capital adequacy ratio stays above 7%, according to reports. It's currently sitting at 10%, so no worries for now.Diamond's pay packet has been the subject of much debate. Latest reports are he'll pocket about £9m in bonuses, although we may have to wait until the annual report is published next month.Many of the City's top dealers have had their basic pay increased since the government brought in rules to limit cash bonuses, BarCap included.But Britain's Big Four - HSBC, Barclays, Royal Bank of Scotland and Lloyds - last week agreed to lend about £190bn to businesses this year in a deal announced by the government today. Under 'Project Merlin', which was conjured up by chancellor George Osborne, £76bn of this sum will be made available to small businesses. Banks have been under heavy pressure to make more funds available to funds since the economic crisis erupted in 2008. The banks have agreed that bonuses this year will be lower than in 2010. Lloyds and RBS have repeated a commitment last year that the cash element of any bonus will not exceed £2000. Osborne said that all executive directors have agreed that bonuses this year will be in the form of shares that vest in 2013 rather than cash.