Barclays CEO Bob Diamond resignation in the
wake of the Libor rate fixing scandal could cast a shadow over
Barclays’ private banking future.
On 29 June, Mediobanca analyst Christopher
Wheeler told PBI that Diamond’s possible exit could cause Barclays
to lose private clients assets.
Go deeper with GlobalData
“Bob Diamond is seen as a key person at
Barclays and, if he is forced out, outflows might be seen as
Barclays’ clients would worry about management turmoil and loss of
momentum,” Wheeler told PBI.
A Barclays spokesperson declined to
comment.
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By GlobalDataDiamond was the man behind Barclays Wealth’s
recent integration strategy and was seen by investors as a
cornerstone in the bank success.
Under Diamond, Barclays moved to a single
corporate brand name which resulted in Barclays Wealth being
renamed wealth and investment management.
Pre-tax profit at Barclays’ wealth and
investment management unit rose 11% to £60m ($94m) in the first
three months of 2012, a 30% increase on a year-on-year basis.
Explosive treasury
committee
Diamond resigned as Barclays CEO early this
morning, just 16 months after he took up the top role.
The move came as a consequence of growing
political pressure, as both UK Prime Minister David Cameron and
opposition leader Ed Miliband called for his resignation.
“The external pressure has reached a level
that risks damaging the franchise – I cannot let that happen,” said
Diamond in a statement.
Tomorrow Diamond will appear in front of the
Treasury Committee, in what is now expected to be an explosive
confrontation since, free from his office duties, the former
Barclays CEO could reveal aspects of the scandal involving other 20
banks around the world.
Resigning chaos
Marcus Agius, who resigned as Barclays
chairman amid the Libor scandal just yesterday, is now to become
full-time chairman and will lead the search for a new CEO, Barclays
said.
In a statement the bank said it is considering
both internal and external candidates for the vacant position.
Meanwhile Barclays’ chief operating officer
Jerry del Missier, Diamond’s right hand, is reportedly on the verge
of resigning as well, according to The Guardian and the Wall Street
Journal.
Investigation widens
The scandal blew up as regulators in the US
and UK slapped a £291m fine on Barclays for manipulating the Libor
to improve markets’ perception of its financial health.
Nearly 20 banks are under investigation for
similar offences by authorities in Europe, North America and
Japan.
To date Barclays has been the only bank to be
officially fined.
