It was just one of the scandals perpetrated by traders in Barclays’s notoriously aggressive investment bank, including the manipulation of foreign exchange rates and gold prices. Deutsche Bank, Standard Chartered and Credit Suisse have all signalled big changes in direction with the appointments of their new CEOs.
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Reports suggest Britain’s third largest bank will soon announce the appointment of former JPMorgan Chase banker Jes Staley as CEO.
“Winding down an investment bank with a big American investment banker in charge of the group is going to be challenging”, the source said.
A person familiar with the situation told Reuters on Monday that Staley, who is presently the managing partner of United States hedge fund firm BlueMountain Capital Management, accepted the offer.
“Barclays’ stock may be over 1% lower than the other banking shares but I’d be wary of pinning the entire fall today on Staley”, Tony Cross, market analyst at Trustnet Direct, told Business Insider. He had been on Barclays’ shortlist when it looked for a CEO three years ago. He joined Blue Mountain Capital and is continuing till date.
Jenkins had clashed over strategy with investment-banking chief Tom King. How do you hold on to expensive investment bankers while also trying to cut costs?
“Getting Jes in would mean moving the bank more towards an investment bank”.
The first was to find a replacement for Mr Diamond who knew how to run an investment bank – which had, historically at least, generated most of the business’s profits.
Labour MP John Mann, of the Treasury select committee, said: ‘There is a danger that the old style banking is creeping back in and that the culture of excessive risk-taking and making a fast buck, which helped trigger the financial crisis, is back in fashion. After all, things didn’t exactly end well under Barclays last American i-banker boss, did they? Farlane has been exploring several options considering potential candidates internally and externally.
Staley is the opposite of ousted CEO Antony Jenkins.
If Staley is appointed as CEO at Barclays, then it will be a second former JPMorgan bankerrunning a UK-based bank. Could Mr Staley’s attraction to Barclays be his potential to serve as a stop gap while grooming his youthful former colleague Tushar Morzaria, Barclays incumbent finance director?
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It is tempting to discern a clear pattern in the backgrounds of the last three chief executives of Barclays: an investment banker from Boston (Bob Diamond), replaced by a retail banker from Stoke-on-Trent (Antony Jenkins), who is now about to be replaced by an investment banker from Boston (Staley). But after Mr Diamond’s departure, it would have been very hard for Barclays to have chosen anyone other than a retail banker like Mr Jenkins.
