Barclays boss vows to be quick and bold in reform plan
By Steve Slater and Sinead Cruise
LONDON (Reuters) - Barclays Plc's (BARC.L: Quote) new boss promised to move quickly and boldly to reform the scandal-hit bank, signaling possible retrenchment in investment banking as he sets out to reform a culture regulators have criticized as too aggressive.
Chief Executive Antony Jenkins, appointed 11 days ago to restore the reputation of Britain's fourth-largest bank after a series of scandals, faces a delicate balancing act in reassuring investment bankers who deliver more than half of Barclays' profits while rebalancing the group's operations.
The bank said it would stop activities that cause reputational damage, possibly including tax advisory practices or the sale of structured products to small businesses, which have both drawn media and political criticism.
But Jenkins said investment banking had a central place within the group although he would scrap or shrink activities that consume a lot of capital or are too risky.
"I absolutely believe that a premier investment banking franchise will be a part of it (the bank)," Jenkins told analysts on a conference call, providing the strongest clues yet on how he will shape Barclays.
But he pledged to change areas of the bank that are inefficient or underperform and to "move quickly and be bold".
"How can we best use our capital, how can we allocate it to areas that are going to deliver the sustainable return with the reputational credibility that we're seeking to deliver?" he asked.
Banks across the board face tough decisions because new regulations are forcing them to stock up more capital to cover riskier trading activities or to hold derivatives contracts, making some investment banking lines unprofitable. Continued...