New Barclays boss looks set to scale back investment banking

Antony Jenkins said tough new regulations and a stagnant economy would make “some activities in investment banking difficult to make an adequate return on”.

His comments to the Sunday Times are the clearest signal yet that he intends to scale back investment banking, a move which is likely to please critics of the sector, such as Bank of England governor Sir Mervyn King.

Mr Jenkins, who was appointed on Thursday, has also promised to do more “listening than talking” as he attempts to rebuild the bank’s reputation in the wake of the Libor-fixing scandal. “I’m going to spend a lot of time with external stakeholders,’’ he was reported as saying.

“I want to hear what’s on investors’ minds. “If they’ve got concerns about how we run the bank, then I would anticipate we’ll change the way we do business,” he told the Sunday Telegraph.

Mr Jenkins also told the newspaper that he is still considering the best structure for management, which suggests that he might 
dispense with the current divisional and functional system that dominates the bank’s executive tiers.

Mr Jenkins, who has been retail and banking boss since 2009, has already announced a review of the bank’s entire operations and abandoned aggressive profit targets set by Mr Diamond, who had wanted to lift returns on equity to between 13 per cent and 15 per cent.

As well as the Libor case, which cost the bank £290m in fines, Barclays has been involved in 
the payment protection insur-
ance scandal and the mis-selling 
of interest rate swaps to businesses.

And his appointment came within hours of Barclays confirming that the Serious Fraud Office was investigating payments made to Qatar Holding, which it tapped for funds at the height of the 
financial crisis in 2008.

Barclays raised nearly £11bn at the time, which effectively allowed the bank to avoid following in the footsteps of Lloyds and Royal Bank of Scotland by taking a state bailout.

Mr Jenkins said Barclays could not rely on the global economy to provide any tailwinds to create more business.

He said rules preventing future financial crises, such as ring-fencing of retail arms, would also bear down on profits.

“There are a number of external factors coming down the line and regulation is clearly a very powerful one,” he added.

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