September 1(Reuters) - The following are the top stories in the Financial Times. Reuters has not verified these stories and does not vouch for their accuracy.

Headlines

CITI PAYS ALLOWANCES TO AVOID BONUS CAP

(http://on.ft.com/1nNSXni)

CAIXABANK BUYS BARCLAYS' SPANISH BUSINESS

(http://on.ft.com/1vZg2ZH)

BIG TESCO SHAREHOLDER REDUCES STAKE

(http://on.ft.com/1vBBvKY)

CARLYLE SETTLES TO AVOID TRIAL BY JURY

(http://on.ft.com/1tmNQlc)

CO-OPERATIVE GROUP MEMBERS BACK BOARD REFORMS

(http://on.ft.com/1ChlknE)

Overview

Citigroup Inc has told senior staff that they would receive fixed monthly pay in addition to their salaries in an attempt to compensate for rules that limit bonuses to up to twice the level of base salaries.

Barclays is selling its Spanish retail and corporate banking operations to Caixabank, the two companies said on Sunday, as the British bank starts shrinking its struggling European divisions as part of a major overhaul.

One of Tesco Plc's largest shareholders, Harris Associates, has cut its stake in the retailer from 3 percent to 1 percent in the past month. The chief investment officer of the U.S. firm's international equity division said it wants to see a clear and coherent strategy emerge quickly.

Carlyle Group LP, owner of roadside rescue and insurance group Royal Automobile Club, has enlisted Sir Michael Rake to lead the planned IPO of RAC in a bid to attract investors after a patchy first half for UK public offerings.

About 83 percent members of the loss making Co-Operative Group voted on Saturday to replace the existing board with independent directors. Ursula Lidbetter, chairwoman of the food, funeral.

(Compiled by Shivam Srivastava; Editing by Cynthia Osterman)