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Tuesday, July 03, 2012

Diamonds Aren't Forever - Bob Diamond Resigns

Yesterday I wrote:
"Barclays has promised:
  • a "root and branch review" of its "flawed" past practices 
  • a public report of the audit's findings 
  • a new mandatory code of conduct for all staff
This presumably is being done in the hope that it doesn't have to sacrifice Bod Diamond, the CEO, who will appear before the Treasury Committee on Wednesday.

Bob and Barclays need to understand two things:

1 Shutting the stable door after the horse has bolted is too late, and

2 Diamonds are not forever!
A day is a long time in banking, and diamonds are not forever.

Today Bob Diamond and Barclays have bowed to the inevitable and Diamond has resgined as CEO of Barclays.

Ironically Marcus Agius, who resigned as Chairman yesterday (in order to save Diamond), will stay on as executive chairman to lead the search for a new CEO. Agius has never had day-to-day operational responsibility for any bank of this size or complexity in his life.

Diamond will still appear before the Treasury Committee tomorrow.

Here is his resignation statement:
"I joined Barclays 16 years ago because I saw an opportunity to build a world class investment banking business. Since then, I have had the privilege of working with some of the most talented, client-focused and diligent people that I have ever come across. We built world-class businesses together and added our own distinctive chapter to the long and proud history of Barclays. My motivation has always been to do what I believed to be in the best interests of Barclays. No decision over that period was as hard as the one that I make now to stand down as chief executive. The external pressure placed on Barclays has reached a level that risks damaging the franchise - I cannot let that happen. 

I am deeply disappointed that the impression created by the events announced last week about what Barclays and its people stand for could not be further from the truth. I know that each and every one of the people at Barclays works hard every day to serve our customers and clients. That is how we support economic growth and the communities in which we live and work. I look forward to fulfilling my obligation to contribute to the Treasury Committee's enquiries related to the settlements that Barclays announced last week without my leadership in question. 

I leave behind an extraordinarily talented management team that I know is well placed to help the business emerge from this difficult period as one of the leaders in the global banking industry.
This of course is not the end of the affair, for either Barclays or the other banks and their executives in the firing line, the ducks are being lined up neatly in a row.

The numerous inquiries (internal and external), investigations by the SFO and FBI and class actions will open the gates of hell for the banks and the BBA.

By the way, can you smell that?

It's the stench of fear coming from the politicians and the Bank of England, as they contemplate what the freshly resigned Bod Diamond will say to the Treasury Select Committee tomorrow.

Bob Diamond's CV (as per Barclays):

Bob Diamond

Barclays Chief Executive

Previously, he was President of Barclays PLC and Chief Executive of Corporate & Investment Banking and Wealth Management, comprising Barclays Capital, Barclays Corporate and Barclays Wealth.
He is an Executive Director of the Boards of Barclays PLC and Barclays Bank PLC and has been a member of the Barclays Group Executive Committee since 1997. He joined the firm in 1996.
Bob is also a Board Member of BlackRock following the integration of Barclays Global Investors.
Prior to Barclays, Bob was Vice Chairman and Head of Global Fixed Income and Foreign Exchange at CS First Boston, where he was also a member of the Executive Board and Operating Committee. Previously, he was Managing Director and Head of Fixed Income Trading at Morgan Stanley International, spending 13 years with the firm.
Bob began his career as a lecturer at the School of Business, University of Connecticut.
A native of Concord, Massachusetts, Bob received a Bachelor of Arts degree in Economics from Colby College in Maine (1974) and an MBA from the University of Connecticut, where he ranked first in his class (1977). He was awarded Doctor of Humane Letters from the University of Connecticut in 2006 and Doctor of Laws from Colby College in 2008.
His external affiliations include:
  • Chairman, Board of Trustees of Colby College, Waterville, Maine
  • Chairman, Old Vic Productions, Plc
  • Trustee, The Mayor’s Fund for London
  • Member of the Advisory Board, Judge Business School at Cambridge University
  • Board Member, The Diamond Family Foundation
  • Member of International Advisory Board, British-American Business Council
  • Life Member of The Council on Foreign Relations
  • Member, The Atlantic Council.
Bob is married with three children.

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