Last month, we had a little fun with Barclays CEO Jes Staley. Staley, who was at the time enjoying a very unusual instant of grudging appreciation from shareholders, has spent the better part of two years trying to turn the bank around by turning its investment bank around. While this appeared to be working, some skeptical Wall Street Journal columnists and snarky bloggers suggested that for all of the apparent success, of which there was some but not much, trying to save Barclays’ I-bank made no sense, both because Barclays sucks at investment banking, and also Barclays having an investment bank at all makes no sense. To which Jes Staley says,
Thursday’s results were “a validation of the strategy that we laid out two years ago,” reiterating that the lender can thrive with a diversified business stretching from credit cards to equity derivatives….
The corporate and investment bank reported a 1% gain in revenue, as choppy markets boosted trading activity. Equities income rose 28%—largely keeping pace with its U.S. rivals—but revenue fell 2% in its bond-trading unit. The bottom line at the unit was helped by a fall in costs and much-lower provisions for bad loans…. Barclays said it was again expanding its investment-banking footprint, reopening an office in Australia it had previously shut. It will also continue to look at reallocating capital into the trading unit from other businesses.
So don’t even think of lumping Barclays in with the endlessly-unfolding catastrophe at Deutsche Bank, which has no such results to distract you from the fines that sent Barclays to a loss this quarter, or the fines that both British regulators and Barclays itself will impose on Staley for his ill-advised little transatlantic anti-whistleblower crusade, or that fact that Staley came perilously close to not being allowed to have his “I-told-you-so” moment.
Barclays PLC said Chief Executive Jes Staley will keep his job after British regulators concluded his attempts to unmask a whistleblower didn’t represent a “lack of integrity” and instead chose to slap the executive with a fine.
Barclays’s board has already said it would dock some of his 2016 pay over the debacle…. Mr. Staley’s total financial penalty could hit seven figures, a person familiar with the bank said.
Unfortunately, Jes’ triumph isn’t going to help pay those fines.
Investors are still not sold. Shares in Barclays fell 1.8% in London trading on Thursday over worries that the bank wouldn’t generate enough profits to fund a mooted share buyback.
Barclays Answers Critics With Investment-Banking Growth [WSJ]
Deutsche Bank Retreats as New CEO Extols ‘Immediate Action’ [WSJ]
Deutsche Bank and Barclays: Trans-Atlantic Drift [WSJ]
Barclays CEO Jes Staley Is Find but Keeps Job After Whistleblower Probe [WSJ]