Just three months after Brady Dougan left Credit Suisse and barely 30 days since Anshu Jain and Jürgen Fitschen tendered their resignations at Deutsche Bank, Barclays has shown CEO Antony Jenkins the door.
The move comes as Chairman John McFarlane (who took over as Chairman in April) looks to restrucutre what he calls a “cumbersome bureauacracy.” The bank did not mince words in its press release announcing the shakeup:
Here’s WSJ with a look back at the outgoing Jenkins’ stint at the helm:
- Despite recent calls of dissatisfaction, the decision to name Mr. Jenkins as chief executive in August 2012 was broadly supported by analysts, and was described as “sensible”, “cool-headed” and “intelligent.” However, the honeymoon period was short-lived. One month later, Barclays was downgraded by Credit Suisse and J.P. Morgan over concerns about the profitability of its investment bank.
- Mr. Jenkins was a Barclays man. He joined the bank as a graduate trainee in 1983. After a six-year spell at Citigroup, he returned in 2006 and by 2009 headed up its retail and business banking. This lack of investment banking acumen led some analysts to speculate that Mr. Jenkins might cut back the unit after its growth under Mr. Diamond. But this never really materialized. Despite some cut backs in fixed-income and commodities, Barclays remains one of the largest investment banks in Europe, despite underperforming its rivals in recent years. Mr. Jenkins defended the high-pay for the unit in 2014 after a poor year, stating that he had to avoid a “death spiral” of rainmakers leaving for rivals.
- Mr. Jenkins didn’t waste time installing a number of projects aimed at moving Barclays away from the Libor-scandal that rocked the bank in 2012. First there was program dubbed “Transform”, aiming to “turnaround, return acceptable numbers, and sustain forward momentum”. Then there was Project Mango, a review of business practices in its investment bank. And then there was Project Electra, another review of the investment bank. During this, Barclays was dubbed itself a ‘go-to’ bank, with reviews into culture, pay, and performance reviews of managers.
- On a long enough time frame, Mr. Jenkins seemed to be the right man for the job. Since he joined in August 2012, Barclays share price is up 52.68%, in comparison the FTSE 100 is up around 15%. On this basis – his reign has been success. However, from August 2013 the share price has fallen 1.12%, compared with an increase of 2.5% for the FTSE 100. During this period Barclays has paid billion-dollar fines for forex rigging, Libor rigging, and failing to keep client assets segregated. It is still facing investigations from the Serious Fraud Office around its capital raising in 2008. While not related to Mr. Jenkins’ tenure, the fines have weighed down the bank’s share price.
- But despite his rocky road, Mr. Jenkins is in good company, joining a group of blue-chip bank chief executives looking for new employment, including Anshu Jain, the former head of Deutsche Bank, and Peter Sands the former head of Standard Chartered. During Mr. Jenkins’s time as chief executive, he was paid a total of £10,011,000. He making money from his own exit: part of his pay, which continues until July 7 2016, is share-based. Shares are up more that 3% on news of his exit.
It’s too bad, really. We’re sure Jenkins was looking forward to a long and fruitful relationship with Richard Fisher, the former Dallas Fed chief Barclays hired last week as a “senior advisor.”
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Full statement from Barclays:
Antony Jenkins to leave Barclays; John McFarlane to become Executive Chairman
Barclays PLC and Barclays Bank PLC (Barclays) announce the departure of Antony Jenkins as Chief Executive and the appointment of John McFarlane as Executive Chairman pending the appointment of a new Chief Executive. Subject to regulatory approval the change will come fully into effect on 17 July 2015 when John retires from FirstGroup. A search for Mr Jenkins’ successor is underway. The interim results will be announced as planned on 29 July 2015.
The Non-Executive Directors led by Sir Michael Rake, Deputy Chairman and Senior Independent Director, concluded that new leadership is required to accelerate the pace of execution going forward and that John McFarlane is ideally qualified in this respect until a permanent successor is appointed. This development does not signal any major change in strategy.
The Board recognises the contribution made by Antony Jenkins as Chief Executive over the past three years in incredibly difficult circumstances for the Group, and is extremely grateful to him in bringing the company to a much stronger position. The situation he inherited would have challenged anyone facing the same issues. This continued a period of achievement as head of Barclaycard and our Retail and Business Banking businesses.
Members of the Group Executive Committee will now report to Mr McFarlane, who will work particularly closely with Tushar Morzaria, Group Finance Director.
Sir Michael Rake commented, “I reflected long and hard on the issue of Group leadership and discussed this with each of the Non-Executive Directors. Notwithstanding Antony’s significant achievements, it became clear to all of us that a new set of skills were required for the period ahead. This does not take away from our appreciation of Antony’s contribution at a critical time for the company.”
Mr McFarlane said, “Whilst it is unfortunate that I have had little time to work with Antony, I respect and endorse the position of the Board in deciding that a change in leadership is required at this time. I would add my personal thanks for everything that Antony has done for us. He can be proud of his heritage, especially his excellent work on culture and values that we will continue. I wish him well.”
“Arriving at Barclays with a fresh perspective, it is evident that we have a standout brand with first-class retail, commercial and investment banking businesses. Nevertheless, we are leaving value on the table and a new approach is required. As a Group, if we aspire to bring shareholder returns forward, we need to be much more focused on what is attractive, what we are good at, and where we are good at it.”
“We therefore need to improve revenue, costs and capital performance. We also need to become more externally focused and deal with the internal bureaucracy by becoming leaner and more agile. I have experienced good results in dealing with these matters elsewhere,” he added.
Antony Jenkins said, “In the summer of 2012, I became Group Chief Executive at a particularly difficult time for Barclays. It is easy to forget just how bad things were three years ago both for our industry and even more so for us. I am very proud of the significant progress we have made since then. Our capital position is much stronger, our business model is more balanced, we are much more disciplined on cost management, we have made good progress in rebuilding our reputation and we are seen as a leader in the application of technology to our business. While the external environment has continued to be, and will remain, challenging the Group now has the resilience to overcome these challenges.
“Most of all, I am proud that we have defined our culture through a common set of values for the Group and that the progress we have made and the tough decisions we have needed to take have all been achieved by applying these values and by focusing on the needs of all our stakeholders.
“I want to thank the people of Barclays for their tireless efforts and support in achieving these results and for my own part I am looking forward to the professional opportunities that lie ahead.”