Robert Diamond, the architect of Barclays Plc’s investment banking expansion, was appointed chief executive officer and pledged to boost the bank’s consumer unit.
Diamond, 59, will become deputy CEO next month before John Varley, 54, steps down at the end of March, the lender said in a statement today. He will move to London from New York and receive as much as £11.48 million ($18 million) in salary and bonuses as CEO.
Chairman Marcus Agius today defended the bank’s universal model, where it acts as both a consumer and an investment bank, as a UK government commission considers forcing lenders to separate the businesses. Barclays, the UK’s third-biggest bank, is trying to cut the proportion of pretax profit generated by its investment bank to a third, down from two-thirds in the first half of this year.
“There’s absolutely no space between John, Marcus and I on the strategic direction of Barclays,” Diamond told reporters on a conference call. “There’s no change in strategy here.”
Barclays fell 2.7 per cent to 314 pence in London, as banking stocks slipped on lingering concern that the sovereign- debt crisis will hold back the global recovery. Barclays recorded the biggest decline in the five-member FTSE 350 Index of UK banks.
‘Very successful’
“The initial reaction to this is likely to be negative because of Diamond’s focus on the investment bank, but it shouldn’t be,” said Simon Maughan, an analyst at MF Global in London. “Barclays has been 70 per cent an investment bank for ages. Barclays shouldn’t be ashamed of being a very successful investment bank.”
Jerry del Missier and Rich Ricci will become co-CEOs of the investment banking unit that Diamond built up since he joined in 1996. Anthony Jenkins oversees Barclays’ retail bank.