LONDON: Barclays is unlikely to formally replace Tom King as head of its investment bank, leaving chief executive Jes Staley in control of the business for the foreseeable future, people familiar with the matter said.
A final decision has not yet been made but the bank is leaning towards not replacing King, who left on March 4. He had been CEO or co-head of the investment bank since May 2013 and made clear last summer he intended to leave in 2016.
Staley, who previously ran JP Morgan's investment bank, knows the industry well and is keen to stay on top of its performance and strategy, the people said.
There are other reasons too: the bank can save money by not replacing King, who was was paid ?9.5m in 2015. Barclays also needs to appoint a head of its new corporate and international arm, which includes the investment bank and would therefore add another executive layer.
Staley became Barclays CEO in December and quickly set out plans for the investment bank. He cut 1,200 more jobs, exited Brazil, Russia and seven countries in Asia and stopped cash equities and precious metals trading.
He said those moves were an acceleration of a strategy that was well underway, and there would be no more radical changes. Last month he said the investment bank was now the right size, anchored in its home markets of Britain and the US.
Since King left, the heads of banking and markets teams have been reporting directly to Staley.
He has been named interim CEO of Barclays Corporate and International (BC&I), which includes the investment bank and all businesses outside a "ring-fenced" unit that all UK banks have to set up to shield UK retail banking units to protect taxpayers and savers.
Setting up BC&I effectively makes the role of investment bank CEO redundant, the people said.
Headhunting firm Spencer Stuart is running the searches for Barclays.
Staley last month told staff that Joe Gold, head of its Americas business, had become deputy CEO of BC&I - another pointer that King won't be replaced even if it takes time to fill the top BC&I post.
Other senior Barclays investment bankers include Joe McGrath and Richard Taylor, co-heads of banking; Joe Corcoran, head of markets; and Andy Jones, head of Asia. John Winter runs corporate banking.
Barclays also appointed Mike Bagguley as chief operating officer for the investment bank in November. Bagguley, who was previously the head of its macro markets business, was tasked with accelerating delivery of the strategy that was already underway - effectively to cut costs and improve profitability.
He was also asked to align infrastructure functions and help coordinate and deliver projects. Bagguley had already overseen the reduction in size and reshaping of the macro business, which includes interest rates, foreign exchange and commodities products, as trading revenues fell and tougher regulation made parts of that business unprofitable.
The people said Staley's decision to hold the reins and not hire a new big-name outsider was also because some people were not interested in the role.
Staley approached his former JP Morgan colleague Blythe Masters last year to see if she was interested in doing the job, people said in December. But Masters said she was fully committed to running her financial technology start-up, Digital Asset Holdings.
Industry insiders said some bankers, particularly in the US, had been deterred from taking senior UK banking jobs due to new UK rules holding them personally accountable for problems on their patch, which could land them in jail.
Barclays' investment bank has halved its risk-weighted assets in the past two years, leaving the level at less than 25% of group assets. It has shifted to a second phase of its restructuring, aimed at shaving more costs and protecting revenues with a leaner, narrower business.
Even so, getting the strategy right for the investment bank remains one of the key issues for Staley, given the volatile nature of the business and the attention it attracts from investors and politicians.
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