British bank Barclays announces departure of group CEO

A search for a permanent successor is underway.

The shakeup comes amid investigations and fines of Britain’s largest bank over its involvement in scandals over foreign exchange currency market manipulation and rigging of the London Interbank Offered Rate (Libor) – the benchmark used to set rates on trillions of dollars in mortgages, credit cards and loans.

He said: “The share price of the bank is the same at it was six years ago, and our dividends are low and flat”. Barclays said he is entitled to 12 months’ notice from the company under his contract of employment and will therefore continue to receive his current salary of GBP1,100,000 per annum; role based pay (delivered in Barclays shares) of GBP950,000 per annum; pension allowance of GBP363,000 per annum; and other benefits until 7 July 2016.

Warning signs were evident when McFarlane highlighted the poor performance of Barclays shares in a letter to shareholders after joining the bank in April.

“As a group, if we aspire to bring shareholder returns forward, we need to be much more focused on what is attractive, what we are good at, and where we are good at it”.

The 68-year-old Scot faces a host of challenges as the British bank grapples with regulatory pressures, such as a demand to separate domestic retail banking operations from riskier investment banking operations, while trying to improve its overall performance.

“It’s the best possible public message that we could have wished for”.

Chairman John McFarlane said the bank needed to become more efficient: “What we need is profit improvement”.

He also emphasized the importance of the investment bank in Barclays’ strategy, seeming to rule out any chance of Barclays exiting it altogether.

McFarlane, a 68-year-old Scot, has built a reputation as one of the City’s toughest chairmen, with the stomach to make tough decisions and act quickly if a business is underperforming.

The announcement has been made weeks after John McFarlane was appointed as chairman of the bank and hinted that he would accelerate its plan of coming up with such changes.

A number of candidates to replace Mr Jenkins are already the subject of City speculation, including Barclays’ finance director, Tushar Morzaria.