Barclays has announced that Bob Diamond, the American-born head of its investment banking operations, will succeed John Varley as CEO. The announcement drew unusually blunt comment from business secretary Vince Cable: Cable was quoted in the FT as saying that Diamond’s appointment illustrated “the wisdom of the government’s decision to set up this banking commission to look at the structure of banks.”
For me, Diamond has done a great job building Barclays’ investment banking franchise deliberately and strategically over many years. He deserves the promotion.
There is work to do on the safety net for banks, so that it preserves the link between risk and reward, is robust for the financial system and remains fair to taxpayers. But splitting up commercial and investment banking, and demonising investment bankers, are no help to anyone. Banking remains one of the few industries where the West retains genuine competitive leadership. It should be encouraged within a sensible regulatory framework, not hobbled. Bob Diamond could be a national asset for Britain, or he and Barclays could be shown the door. We’ll see which course the UK chooses.
An FT report on Diamond’s appointment is here: http://www.ft.com/cms/s/0/a7aae28e-ba0a-11df-8804-00144feabdc0.html
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