(Reuters) – Britain’s Barclays has picked softly spoken retail boss Antony Jenkins as its new chief executive to fill the shoes left by Bob Diamond, the colorful American investment banker who resigned after a rate-rigging scandal.
Jenkins, brought in six years ago to turn around the British bank’s credit card business, lacks experience in investment banking, which, though a big profit driver for Barclays, has been at the heart of the firm’s recent troubles.
Jenkins’s manner will mark a sharp contrast with the flashier style of Diamond, who built up Barclays’s thriving investment bank but resigned as chief executive in July after the bank admitted manipulating the Libor benchmark interest rate.
Diamond was, however, grooming Jenkins for the top job before his own fall from grace.
“He’s a very capable guy,” Oriel Securities analyst Mike Trippitt said. “I think the fact that he’s come up the ranks in the retail and commercial world means he’ll take a very fresh view of the investment bank.”
Trippitt added that Jenkins was unlikely to kill off the latter, but would look at how capital was allocated in the divisions.
Technology and gadget enthusiast Jenkins beat off competition from external candidates for the role, confounding those who had thought the bank would look outside to signal a clean break with former management.
Barclays on Thursday vaunted Jenkins’ “intimate knowledge” of the bank’s portfolio, and his retail experience could be an advantage in the face of new rules forcing UK banks to safeguard small customers.
British banks are being asked to effectively isolate their riskier investment bank arms from their retail businesses, so taxpayers will not have to bail them out in any repeat of the financial crisis that struck in 2008.
Jenkins inherits a daunting in-tray. His appointment came hours after British fraud prosecutors confirmed they were launching a criminal probe into payments between Barclays and Qatar Holding in 2008.
Four current and former senior employees are also under investigation by the financial watchdog, including finance director Chris Lucas.
In June Barclays paid $453 million to U.S. and UK authorities to settle with regulators over the Libor probes.
“We have made serious mistakes in recent years and clearly failed to keep pace with our stakeholders’ expectations,” Jenkins said in a statement.
Chairman Marcus Agius also resigned over the Libor scandal. Industry veteran David Walker will replace him in November – an appointment that could appease some worried about the future of the investment bank, though the public spotlight is still bearing down on the division.
Jenkins, an Oxford University graduate who started his career at Barclays as a trainee before moving to Citi in 1989, added that repairing the damage would “take time”.
Barclays said Jenkins would receive an annual salary of 1.1 million pounds ($1.74 million), plus up to 2.75 million pounds in annual incentive awards plus long-term incentive awards of up to 400 percent of salary.
(Additional reporting by Matt Scuffham; Editing by Will Waterman)