Barclays signals investment banking revival with new CEO Jes Staley

Barclays has signalled a major move back into investment banking after hiring one of Wall Street’s best known bankers as its new chief executive.

The bank is to hire former JPMorgan investment banking chief James “Jes” Staley for the top job.

The appointment, which still requires the approval of UK financial regulators, is set to be unveiled at the group’s financial results statement on 29 October.

However, a formal announcement could come as soon earlier if UK authorities demand clarification. Barclays declined to comment.

The signing marks a coup for Barclays chairman John McFarlane, who had signalled a change in direction to appease shareholders frustrated by the group’s underperforming share price.

Staley is a former head of JPMorgan’s investment bank.

News of the 58-year-old’s appointment sent the shares down 3% to 249.4p, perhaps signalling uncertainty over his potential strategy.

He quit JPMorgan in 2013 to join hedge fund BlueMountain Capital.

Staley will renew his relationship with current Barclays chief financial officer Tushar Morzaria, who he worked alongside at JPMorgan when Morzaria was finance boss in its corporate division.

“Staley is the archetypal well-trained investment banker. He’ll be very good at execution and pushing things through,” Atlantic Equities US bank analyst Chris Wheeler said.

The appointment marks a return to the pre-financial crisis era for the bank, when it was led by bombastic investment banker Bob Diamond, who was forced out by regulators because of his strident strategy.

Since then, the investment bank has suffered from a loss of talent, most notably the high-profile exit of US investment banking chief Hugh “Skip” McGee in April 2014.

The leadership of former chief executive Antony Jenkins, an ex-retail banker, also called into question the company’s focus on its investment banking pedigree due to his insistence on shrinking the capital markets portion.