Jes STALEY, an investment banker who was well-known on Wall Street and a true titan in his field, has been fired as Barclays’ chief executive.
Following an investigation by UK regulators of Mr Staley’s connections to Jeffrey Epstein, his resignation was announced.
What about the American, who took over one of Britain’s biggest banks but left it six years later.
James E. Staley, a Boston native, joined JP Morgan Chase in 2005 after completing an economics degree.
This would mark the beginning of a 30-year career at US bank giant. He would climb through the ranks and become boss of firm’s investment bank division. In 2009, he was a lieutenant to JP Morgan Chase Chief Executive Jamie Dimon.
Over the years, Staley was promoted to head JP Morgan’s Private Client Division. It was there that in 2000, he developed his first “professional relationship” with Epstein.
Fortune magazine described Mr Staley as “a throwback” to an outdated idea about what a banker should be in 2010. Staley was soft spoken and clients-focused, and was so far under the radar that few people outside of finance had ever heard of him.
It also stated that Jes is free from innuendo. There is no grey. His yes indicates yes. His no is no.”
After the 2008 financial crisis, Mr Staley was appointed as the head of the bank’s investments arm. Rumours circulated about Mr Dimon being in the process of grooming him for his top job.
According to Mr Staley, “If Jamie does not leave, then I will probably have to leave myself within a few years.”
After initially being denied the Barclays Top Job in August 2012 by Antony Jenkins, Mr Dimon did not leave and hasn’t quit JP Morgan Chase. However, Mr Staley left the bank to start BlueMountain Capital Management.
In 2015 Mr Jenkins was fired. However, the criticism of the bank’s loss of investment banking was addressed by Mr Staley.
With yearly earnings edging towards £8.2m if he was awarded his maximum bonus, the 63-year-old’s tenure as the boss of Barclays saw the British bank deliver good returns and profits which beat analyst estimates.
Susannah Streeter is a senior Hargreaves Lansdown investment and markets analyst. She said that his vision for Barclays helped it to “very good stead” in dealing with the economic effects of the coronavirus epidemic.
But, there was some controversy.
In 2018, the father-of-two hit the headlines when he was personally fined £642,430 by the Financial Conduct Authority and the Prudential Regulation Authority for breaching rules by trying to identify a whistleblower two years earlier.
This was due to anonymous correspondence sent to Barclays board members that raised concerns regarding Tim Main, a senior bank executive who had been hired by them earlier in the year.
Mr Staley asked Bank’s Security Chief to help him identify the writers of the letters. He believed it was an unfair personal attack against the senior bank employee.
Financial Conduct Authority stated that Mr. Staley violated the standards of care and expectation of chief executives in a way which could undermine confidence in Barclays’ whistleblowing procedure.
Staley offered his apology for his role in the matter.
He also earned the bank a $15m penalty from US regulators. However, he was able to survive the scandal thanks to the support of Barclays board members. This gave him the distinction of being first manager of major financial institutions to retain his position after being punished by the watchdogs.
Some insiders at Barclays believe that his behavior in Epstein and this case indicates an excessive loyalty to friends. Others are inclined to label it his tragic character flaw.
Another victim of the whistleblower scam was a Barclays customer who tried to con Mr Staley into e-mailing him as John McFarlane (the bank’s chairman at the time).
This email included a poem in the which the letters at the beginning of every line represented the word “whistleblower”.
However, Staley missed the prank, and replied to the email pretending it was genuine. Calling McFarlane “a rare man”, and giving praises for his guitar-playing abilities, he said that he didn’t know what to do.
The prankster posted details about the feat on Twitter, and later with the Financial Times. This revealed his gullibility.
Fairness to Mr Staley: He isn’t the only Barclays boss who has fallen from grace over recent years.
He is actually the fifth bank chief executive after seven years. This follows in the steps of Bob Diamond who quit over a scandal involving interest rates and Mr Jenkins who was fired for arguing with the board about the bank’s profitability and cost-cutting.
He spoke out about the “unsustainable” culture of work from home during the pandemic.
At the World Economic Forum’s virtual meeting, he stated that it would be increasingly challenging to preserve the culture and cooperation these big financial institutions want and need.
Barclays must now maintain its culture and culture without him. This may prove difficult.
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