Chairman John McFarlane confirmed this morning that Jenkins – who comes from a retail banking background – was relieved of his position as Barclays looks to put more focus on its investment banking business.
McFarlane will take over the running of the bank until a successor for Jenkins is appointed.
While the news came as a surprise to some, James Box, banking analyst at Brewin Dolphin, said that Jenkins’ departure has been in the pipeline since McFarlane joined the firm in April.
“This is history repeating itself,” Box explained. “When McFarlane turned up at Aviva, within four months dividend was slashed and the CEO was sent packing, followed by McFarlane bringing his own man in with a clear mandate.
“As soon as McFarlane was on the scene, Jenkin’s days were numbered. Perhaps it did not seem like it would be this soon, but it was going to happen at some point.”
Box believes that the change underway at the top affords the bank the opportunity to develop a much clearer vision going forward and the share price – which was up 3.27% at 10.46am on 8 July – could reflect this in the long-term.
“When McFarlane does find someone it will create a much more stable platform for change,” he expanded. “It will be a CEO with the backing of a very strong chairman, which will lend much more strategic clout internally. Jenkins did not have that – he was just another guy who ran a division internally, and found it difficult to impose himself on the investment banking guys.
“While people tend to jump the gun on these restructuring stories, there will be a bit of relief. Sentiment-wise this is positive and should translate to a good share price, depending on what the new CEO tells the market they are going to do. Barclays is not cheap at the moment, but there could be a bit of upside.”
