Thursday, August 30, 2012

Barclays appoints retail head as new CEO

(AP) ? Barclays PLC on Thursday named the head of its retail and business banking operations as its new chief executive, as shares in the group dropped following news of an investigation into an overseas investment deal.

The bank announced that Antony Jenkins, 51, would fill the post vacated by the resignation of Bob Diamond in the wake of a scandal over attempts to manipulate a key interest rate index.

Jenkins takes over just as the bank has been hit by more bad news. Barclays disclosed Wednesday that Britain's Serious Fraud Office was looking into the bank's payments to Qatar Holdings LLC when Barclays raised more than 5 billion pounds ($8 billion) of emergency capital at the height of the global financial crisis, funds which saved Barclays from needing a government bailout.

Gary Greenwood, an analyst at Shore Capital, said the investigation "further highlights Barclays' somewhat murky past under the previous leadership and the need for the new management team to come in and clean up the company's culture, processes and image."

Barclays shares were down 1.7 percent at 183.1 pence in early trading in London, the first market reaction to the investigation and Jenkins' appointment.

Barclays is also assumed to be a target of a Serious Fraud Office investigation of manipulation of the London interbank offered rate (LIBOR), a market index which sets the price of a wide range of financial instruments including mortgages.

So far, Barclays is the only bank which has been identified as submitting false reports of the rates it expected to pay to borrow from other banks, although other banks are known to be under investigation. Barclays was fined $453 million by U.S. and British agencies in June, and Diamond resigned on July 3.

"We have made serious mistakes in recent years and clearly failed to keep pace with our stakeholders' expectations," Jenkins said.

"We have an obligation to all of those stakeholders - customers, clients, shareholders, colleagues and broader society - and a unique opportunity to restore Barclays' reputation by making it the 'go to' bank in all of our chosen markets."

Associated Press

Source: http://hosted2.ap.org/APDEFAULT/f70471f764144b2fab526d39972d37b3/Article_2012-08-30-EU-Britain-Barclays/id-d29f54dffc1446378d59fd3cb2e68f81

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