Sir David Walker, 72, replaces Marcus Agius as Barclays’ new £750,000 a year chairman following Libor scandal
Barclays has named the City establishment figure Sir David Walker as its new £750,000 a year chairman as it moves quickly to fill the management void created in the wake of the Libor scandal.
Walker, a 72-year-old who has worked in finance and banking for half a century, will replace Marcus Agius, who resigned following the record breaking £290m fine slapped on the bank for attempting to manipulate the crucial interest rate benchmark.
The appointment of the Cambridge graduate, who began his career in the Treasury and the Bank of England before becoming a regulator, will help to accelerate the search for a new chief executive to replace Bob Diamond, who left abruptly the week after the Libor fine was announced in June.
“My immediate priority, and critical to Barclays’ ongoing success, will be the appointment of a new chief executive and I will be fully engaged in that process,” Walker said in the statement announcing his appointment.
He will join as a non-executive director next month. Agius will stay on for a short handover period until 31 October, when Walker will take over at the bank, which is in the midst of a major reputational crisis. Some £100,000 of his £750,000 a year fee for being chairman will be paid in shares and he is committed to working “no fewer than four days per week”.
While Walker began his career in the Treasury and ended up running the former City regulator, the Securities and Investments Board in 1988, he went on to a City career which spanned both retail banking, at Lloyds, and investment banking at Morgan Stanley.
Both areas are crucial for Barclays but there is speculation the investment banking arm – created by Diamond and until recently known as Barclays Capital – will be scaled back.
But Agius signalled that Walker’s appointment should quash any ideas that the so-called universal banking model – combining investment banking and retail banking – would be broken up.
“He will be taking over at a time when Barclays’ universal banking model is delivering a strong performance in difficult markets,” Agius said.
Walker said he was “looking forward” to joining Barclays and “playing my part in taking the company forward after recent events”.
“The UK needs a strong financial services sector and Barclays has a crucial role to play in ensuring that this country has a successful, well-governed banking industry,” Walker said.
His appointment has been cleared by the Financial Services Authority and given tacit approval by the governor of the Bank of England, Sir Mervyn King, who was approached by the Barclays non-executive director Sir John Sunderland, who led the search.
Top five shareholder Legal & General Investment Management was supportive, saying the bank had “engaged and sought” shareholder views.
Repairing relationships with regulators will also be key for Walker after a top FSA official Andrew Bailey told MPs the bank had a reputation for “gaming” its regulators. Diamond left after King told Agius that the chief executive no longer had the confidence of his regulators.
Walker has handled crisis in the past. In 1985 he was parachuted as chairman into Johnson Matthey Bankers, a bullion firm linked to a coup in Nigeria, which at the time was described as “the biggest crisis for the Bank of England since the bank failures of 1973 and 1974”.
He was called on by Labour during the banking crisis to review the conduct of the City and the pay of bankers. His review recommended disclosing how many staff earned over £1m without naming them. Identifying high earners could drive “talent” abroad, he warned at the time. He later backed down and the coalition government did not implement his reforms.
He was called on more recently to oversee the publication of the Financial Services Authority’s report into what went wrong at Royal Bank of Scotland.