Scandal-hit Barclays axes chief executive as bank toughens overhaul

Barclays CEO Antony Jenkins (above) will be replaced by chairman John McFarlane.
Barclays CEO Antony Jenkins (above) will be replaced by chairman John McFarlane.PHOTO: BLOOMBERG

LONDON (BLOOMBERG, AFP) - Troubled British bank Barclays, mired in the forex and Libor rigging scandals, announced Wednesday that it has fired chief executive Antony Jenkins.

Barclays said chairman John McFarlane would take over executive duties until a permanent successor to Jenkins was appointed.

"This development does not signal any major change in strategy," the bank added.

Jenkins, 53 a former consumer banker, took over from Robert Diamond in 2012 after the bank was fined for manipulating benchmark interest rates.

Since taking the job, he has eliminated thousands of jobs and sold assets after tougher capital regulations and rising fines undermined earnings. Still, some analysts have said the bank will struggle to meet its profitability targets unless it deepens cuts at the investment bank.

"It became clear to all of us that a new set of skills were required for the period ahead," Barclays said in the statement. "New leadership is required to accelerate the pace of execution going forward," with McFarlane "ideally qualified in this respect," the bank said.

McFarlane, 67, replaced David Walker, 75, earlier this year with bank still mired in misconduct scandals and struggling to revive earnings and profitability. By becoming executive chairman, he is taking on a similar role to what he held at Aviva, where he helped restructure the U.K. insurer, replacing most of the board and boosting returns.

Under Jenkins, the bank pledged to eliminate some 7,000 jobs at the investment bank, cut the division's share of group assets to 30 per cent from about 50 per cent and set up a bad bank to sell assets including complex derivatives.

His efforts failed to have a quick impact, with the securities unit reporting a 2.7 per cent return on equity in 2014, down from 8.2 per cent a year earlier and below Jenkins's group target of 12 per cent. It also made it the least profitable of four units.

Barclays shares have increased about 3.6 per cent this year, making them the third-worst performers among major British lenders.

The board "recognizes the contributions made by Antony Jenkins as chief executive over the past three years in incredibly difficult circumstances," Barclays said.

Jenkins will receive 12 months' salary, role-based pay and pension allowance as well as remain eligible for a bonus for 2015.