Barclays Bites the Bullet

Beginning of the end for old-style universal banks

According to the UK’s Parliamentary Commission on Banking Standards, it had “its finger in every scandalous pie.”

That would be Barclays Bank.

But now, the unpretentious, retail banking executive who replaced Bob Diamond as Barclays’ CEO last year – Antony Jenkins — is putting his own stamp on the bank and has promised to turn it into a model citizen.
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Jenkins’ stern message to the troops at Barclays is “play by the rules or get out.” His diktat goes well beyond the rejiggering of compensation schemes and rooting out of proprietary trading that big bank managements around the globe have been resisting and finessing since the financial crisis.

Under Jenkins’ reformation, personal gain and corporate profits will be taking back seats at Barclays to commercial integrity and customer service. Jenkins, 51, believes it will take at least five years to overhaul the culture at the bank. The questions now are whether Barclays can actually achieve that lofty standard and, if so, whether that standard then becomes the industry standard (see Can Companies Sin?). In London banking circles, Jenkins has been waggishly nicknamed ‘Saint’ Antony according to the Financial Times.

Bankers everywhere may see Barclays’ heroic attempt at reinvention as the beginning of the end for old-style universal banking. Many ambitious, free-wheeling bankers have already seen the writing on the wall and jumped ship to hedge funds or start-ups. Other demoralized but less-seasoned bankers are returning to grad school and, in the UK, out-of-work bankers are actually signing up for compliance training. That career path would have been unthinkable just a year ago.

At Davos last month, global banking’s bigwigs were buzzing about who would be running their institutions after all the go-getters are gone.

At Davos last month, global banking’s bigwigs were buzzing about who would be running their institutions after all the go-getters are gone.

It’s a good bet it will be modest and upright executives like ‘Saint’ Antony, unless Barclays’ ethical make-over turns out to be pure poppycock or falls flat on its face financially.