Barclays has fired its CEO Antony Jenkins after three years on the job. He will be replaced by the chairman, John McFarlane, on an interim basis. The shares rose by 3% on the news. Barclays is the fourth big European bank to change leader this year, underlining banks’ struggle to adapt post-crisis.
What the commentators said
In some ways, Jenkins’s reign has been a success, said Giles Turner on WSJ.com. The share price has risen by 52% since August 2012, when he started. Investors liked his commitment to overcoming the Libor interest-rate rigging scandal and reviewing business practices to burnish the bank’s reputation.
But the share price has stalled over the past two years, said Lex in the FT – all the gains came in the first six months. That’s partly about Barclays’ poor profitability and high costs. Last year the bank made a return on equity of -0.2%. The cost-to-income ratio “is far too high” at 70%.
What went wrong? Commercial and retail banking, Jenkins’s specialities, are doing well, said Richard Buxton of Old Mutual Global Investors, but “the speed of improvement across the group… needs to be more focused… there are too many decisions by committee”. It probably didn’t help matters, added Patrick Jenkins on FT.com, that McFarlane had little time for Jenkins’s “sometimes ponderous analysis and empty-sounding consultancy speak”.
But while he may have disliked his style and slow cost-cutting progress, he shared the overall aim: retrenching from investment banking. So a major change in direction is unlikely. “What that means for former investment banker Tushar Morzaria, the finance director long considered the internal favourite to succeed Jenkins, is unclear.”