Barclays boss fights for his job after £2bn share fall
ALMOST £2bn was wiped off Barclays shares as chief executive Jes Staley fought to keep his job over a whistleblower scandal.
Shares dropped more than 5pc as Staley desperately tried to draw a line under the crisis in which he had sought to uncover the identity of a staff member who criticised him.
The share plunge came as investors became jittery over disappointing profits that overshadowed a promise to create 2,000 jobs. Staley did little to calm nerves when he refused to say if the bank had an emergency plan in place should he be ousted.
The 60-year-old American was incensed when anonymous letters criticised his hiring of senior banker Tim Main, who had suffered health problems when they worked together at JP Morgan.
He ordered his security team to find out where the notes were from in a search supported by a US law enforcement agency.
This broke rules protecting anonymous tipsters – triggering an investigation by the Financial Conduct Authority.
Staley faced public questions over the scandal for the first time yesterday as Barclays unveiled its financial results for the first quarter of 2017.
He said: ‘What I can say right now is limited. As I’ve said, I made a mistake. I was trying to protect a vulnerable colleague but I should have left the organisation to handle it.’
The furore has cast doubt on Staley’s future at Barclays after a strong start since he took the reins around 18 months ago.
It has prompted calls for his resignation from campaigners, disquiet from shareholders and gossip across the City.
If Staley is forced out he would be the third Barclays boss in a row to leave under a cloud.
His predecessor Antony Jenkins was sacked by chairman John McFarlane over Barclays’ performance, and before that Bob Diamond quit in disgrace over the Libor rate-rigging scandal.
The bank is braced for a stormy annual meeting next month, when Staley will face re-election to the board by investors. He is likely to win the vote but some investors are expected to rebel.
Consultancy ISS, which advises on ballots, has recommended abstention to shareholders.
Yesterday, Staley said he had unanimous support from his board and had not offered his resignation. However, he declined to comment when asked if he had a message for shareholders and whether there were contingency plans to replace him if the FCA forced him to stand down.
The case is the regulator’s most high-profile probe ever into a bank chief, and it is likely to face accusations of collusion unless it takes a harsh line.
Barclays profits rose to £1.7bn in the first three months of 2017, more than double the amount a year earlier. This excluded a oneoff £884m hit to the value of the lender’s African business, which it is selling.
Staley also announced the bank was creating 2,000 technology jobs as it seeks to boost its IT operation. Shares fell 5.2pc, or 11.7p, to 212.25p.