Former FSA chief has a blemished record but is still a big catch
Hector Sants’ record at the Financial Services Authority was, to put it mildly, chequered. Long after he became chief executive in July 2007, HBOS had its foot to the lending pedal. The FSA under Sants also seems to have grumbled in private about Barclays’ “culture of gaming” without actually stamping on it.
Sants’ famous declaration that bankers should “be afraid” of the FSA looks laughable with hindsight; if British bankers fear anyone it’s the American regulators, as HSBC and Standard Chartered will surely attest.
Yet Antony Jenkins, Barclays chief executive, is right to regard the recruitment of Sants as the bank’s new chief compliance enforcer as a smart piece of business. For all the FSA’s failings, it would be unfair to call Sants a busted flush. He holds firm views on the perils of short-termism, and is clearly on the side of those who think banking needs root-and-branch cultural reform. It’s quite possible that, on the inside, he’s better able to put these ideas into practice. Recalcitrants within Barclays would be wise not to underestimate him – the status of ex-chief regulator still carries weight.
In the end, though, ultimate responsibility for cultural overhaul at Barclays still lies with Jenkins. So far, he’s shown himself to be a nice guy but has not answered the question of whether he’s tough enough to shake up the place. February’s unveiling of the grand plan had better be good – the warm-up has taken too long already.
The mystery is really why Sants wants the gig. He could have been head of the new Prudential Regulation Authority, where, with the force of the Bank of England at his disposal under the new regulatory set-up, he could have been calling the tune to Jenkins. Instead, Sants surrendered that role-in-waiting, seemingly voluntarily, in June.
The pay, inevitably, will be better at Barclays but one suspects he was expecting to be offered something grander than a position below board level at one of his old charges. Maybe he wasn’t inundated with job offers.