Jes Staley’s tenure as CEO of Barclays’ (LON:BARC) is seen at risk with regulators looking into his attempt to identify a whistleblower. Bloomberg reported yesterday that the Financial Conduct Authority’s (FCA) probe, which will take several months, could result in anything from a verbal warning to Staley losing his status as an approved person and therefore his ability to run the bank.
Barclays’ share price has slipped into the red this morning, having lost 0.57 percent to 214.97p as of 08:52 BST, underperforming the broader London market, with the benchmark FTSE 100 index having climbed 0.26 percent to 7,368.03 points. The group’s shares have added more than 40 percent over the past year, but have given up nearly four percent in the year-to-date.
While Barclays said that it would formally reprimand Jes Staley and cut his payout, Bloomberg reported that the FCA probe, which is expected to take several months, could potentially find him unfit to run the FTSE 100 lender. The bank disclosed yesterday that regulators were investigating Staley in relation to an attempt to identify the author of a letter which was treated by the lender as a whistleblow. The letter referred to matters of a personal nature about a senior employee.
A person familiar with the probe confirmed to the Financial Times that the individual that Staley had been trying to protect was Tim Main, a New York-based banker who joined Barclays in June last year to chair the investment bank’s financial institutions group.
“An interesting question is, what would have happened to someone much farther down the food chain? They’d have lost their job,” Owen Watkins, a lawyer at Lewis Silkin in London and a former regulator at Britain’s Financial Services Authority, the precursor to the FCA, told Bloomberg in an interview.
The Times meanwhile quoted a senior London-based banking executive as saying that the issue looked “really bad for them”.
“I don’t believe there is any way he can stay in the job,” the source added.
Shore Capital meanwhile has backed Staley, arguing that it was in the best interests of the bank’s shareholders if he stayed in his position, given Barclays’ ‘excellent’ progress under his leadership.
“To remove Staley from his role at this juncture would be damaging to further operational progress, with an improvement in return on equity now the key area of focus,” the broker’s analyst Gary Greenwood noted, as quoted by Citywire.