May 1, 2018 / 9:30 AM / 25 days ago

Barclays chairman insists not going yet, shareholders back CEO

(LANGUAGE ADVISORY: please note strong language in paragraph 13)

FILE PHOTO - John McFarlane, Chairman of Barclays, arrives for a meeting with Britain's Chancellor of the Exchequer, George Osborne, at Downing Street in London, Britain July 5, 2016. REUTERS/Peter Nicholls

By Lawrence White and Emma Rumney

LONDON (Reuters) - John McFarlane said he is not about to quit as chairman of Barclays, adding that most shareholders backed Jes Staley to remain as the British bank’s chief executive following a misconduct inquiry.

Barclays has faced uncertainty over its leadership, mainly due to regulatory scrutiny of Staley’s treatment of a whistleblower and concerns among some investors about its investment bank-focused strategy.

McFarlane, 70, told Barclays’ annual meeting on Tuesday that he had asked the chairman of its nominations committee, Crawford Gillies, to prepare for his eventual departure, but added he had only served three years of his four year term.

“You are not getting rid of me yet,” he told the meeting, following speculation he could bow out early.

Barclays is also under pressure from activist investor Edward Bramson, a turnaround expert who has taken a 5 percent holding in the bank.

McFarlane told Michael Mason-Mahon, a frequent bank critic and AGM attendee, that more than 95 percent of shareholders had no worries over Staley’s fitness to run the bank.

“You say you have been in banking over 38 years, you should have known better than to bring shame on our bank,” Mason-Mahon said, accusing Staley of hurting the bank’s reputation.

There had been speculation Staley could lose his job for trying to identify who sent a letter raising “concerns of a personal nature” about an unnamed senior bank official.

But Staley survived the ensuing inquiry with a fine and McFarlane said the “malicious letter” contained false allegations and had not come from within the bank.

“If it had been a whistleblow from an employee, then the matter would have been much more serious,” he added.

NOT SO SMART

The bank also faced flak from investors over its accident-prone investment platform, which has hit a number of glitches since being overhauled and rebranded last year.

Staley has apologized for the problems on the platform, dubbed Smart Investor, which included investors being locked out of their accounts and transfers taking months to complete.

“I would rather stick wasps up my arse than recommend using Barclays Smart Investor,” one shareholder told the meeting on Tuesday.

The chairman did not respond directly to that criticism.

Shareholders have also berated Barclays in recent years for disappointing profits, particularly from its investment bank. Mixed first quarter results last month failed to allay the concerns of some analysts.

McFarlane said that the shareholder meeting marked a “turning point”, but agreed there was more to do.

Significant investment was still needed to secure revenue growth, benefit from the digital economy and bolster defense against risks such as cybercrime, he said.

Meanwhile, Staley said he had no plans to set up a trading desk for cryptocurrencies, after some reports suggested that the bank was gauging clients’ interest.

Security guards removed demonstrators who used the meeting to protest at what they said was Barclays’ funding of industries that damage the environment.

McFarlane said a review had been carried out into the bank’s financing of tar sands and other natural resources, and this would be published this year.

Reporting by Lawrence White, writing by Emma Rumney, editing by Sinead Cruise, Alexander Smith and Keith Weir

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