BARCLAYS abruptly fired its chief executive, Antony Jenkins, today, claiming “a new set of skills” was needed at the top of the bank as it struggles to make better financial returns seven years after the industry crash.
The move largely wrongfooted the City, even though there had been some speculation that operational change might be in the pipeline when Scots-born John McFarlane became chairman in April after his shake-up of the insurance giant Aviva.
Banking analyst Keith Bowman at Hargreaves Lansdown said: “It’s a shock. Possibly the new chairman might think the rebalancing of Barclays has not gone quickly enough. It is also possible that Jenkins’s inexperience in investment banking might have told against him.”
Sir Michael Rake, the group’s deputy chairman, said yesterday that new leadership was required to accelerate the bank’s pace of change.
“I reflected long and hard on the issue of group leadership and discussed this with each of the non-executive directors,” Rake said.
“Notwithstanding Antony’s significant achievements, it became clear to all of us that a new set of skills were required for the period ahead.”
Barclays said it will appoint McFarlane as executive chairman from 17 July as a search for a new chief executive is launched.
The move comes four months after Barclays posted a 12 per cent rise in underlying annual pre-tax profits to £5.5 billion – but the performance was marred by a fresh £750 million hit from the foreign exchange rate-manipulation scandal.
Jenkins leaves with 12 months’ notice and will receive his current annual salary of £1.1 million, £950,000 in role-based pay and a pension of £363,000 a year.
A retail banker by background, he became chief executive in summer 2012, replacing Bob Diamond, the colourful American investment banker who was ousted in the wake of Barclays’s involvement in the Libor‑rigging scandal.
Jenkins pledged to bring a new ethical culture to the bank, holding his first results meeting and strategy update well away from the City, at the Royal Horticultural Halls and conference centre in Westminster.
Jenkins said yesterday that he 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.”
He said he was most proud “that we have defined our culture through a common set of values for the group”. He added: “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.”
McFarlane was chairman at Aviva in 2012 when the insurer axed its boss, Andrew Moss, after a lengthy period of under-performance of the business.
He then also acted as executive chairman until the insurer found its new chief executive, Mark Wilson.
McFarlane said yesterday: “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.”
He said that with his “fresh perspective” he could see that Barclays has first-class retail, commercial and investment banking businesses.
McFarlane added: “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.”