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Thursday, April 17, 2014
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Reports: Barclays chairman to resign this week
LONDON—Two British media outlets are reporting that the chairman of UK-based Barclays bank plans to resign this week following the scandal regarding the manipulation of data by his bank. The Guardian newspaper and the BBC reported yesterday that Marcus Agius will step down after having served as Barclays’ chairman for about six years.
US and British agencies imposed fines totaling $453 million on Barclays last week for submitting false data used in setting the London interbank offer rate, LIBOR, a key market index, between 2005 and 2009. The bank submitted that data to make its financial position appear stronger. The Guardian and BBC did not explain whether Agius was linked to the scandal.
The UK Guardian reported that Agius was expected to stay on while a full-time successor is found as the Financial Services Authority, the City’s regulator, would need to approve the position. The newspaper said that existing board member and former Cadbury boss Sir John Sunderland would lead the search for a full-time successor. Sir Michael Rake, a former top accountant and senior independent director on the bank’s board, is regarded as the front-runner but he has numerous other commitments which could prevent him taking on the role, even temporarily.
The boardroom reshuffle comes as Barclays gears up for Diamond’s appearance before MPs on the Treasury select committee on Wednesday. The American-born chief executive is expected to face tough questions about what changes have been made at the bank since it was landed with a record £290m fine last week.
“The fine, and the embarrassing emails disclosing the way that traders attempted to manipulate the interest rates with offers of bottles of Bollinger champagne, unleashed a wave of political fury —which will intensify when MPs hold their hearings on Wednesday and Thursday,” according to the UK Guardian.
The newspaper said that while Diamond is expected to make clear to MPs that Barclays was not alone in the practices—which dated back as far as 2005—the decision by the bank to settle with the regulators in the City and in the US has put it in the spotlight. He is likely to be questioned about conversations he had with the Bank of England at the time. Until this weekend, Barclays’ board had felt that it had taken tough action in the wake of the fine. Diamond forfeited his bonus for 2012, as have his close colleagues Jerry del Missier and Rich Ricci as well as the finance director, Chris Lucas.
Shareholders, though, want to claw back bonuses from prior years and are concerned about the impact of political intervention, which has already contributed to a £4b slump in the company’s value in just 72 hours, according to the newspaper.
Barclays declined to comment.
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