Barclays set to name Jes Staley as new chief executive

Jes Staley currently works for a US hedge fund

Barclays is set to appoint former JP Morgan banker James "Jes" Staley as its new chief executive.

It is understood the Barclays board has approved the appointment of Mr Staley and that a formal announcement will be made in the next fortnight.

Barclays' previous chief executive, Antony Jenkins, was fired from the bank in July after falling out with board members.

Mr Staley currently works for US hedge fund Blue Mountain Capital Management.

BBC business editor Kamal Ahmed told the Today programme that previously "there had been big tensions within the bank" between the retail and investment divisions.

He added that investors were unhappy with the change of focus of the bank towards retail banking under Mr Jenkins.

The board of Barclays has agreed the appointment of Mr Staley and the bank is now waiting for regulatory approval before making an official announcement.

Our editor added that with the troubles faced by the banking sector, including the taxpayer-funded bailout of Royal Bank of Scotland, some people within the City are concerned that London is losing its position as global banking centre. The appointment of Mr Staley might be seen as trying to resurrect that position.

Shares in Barclays were 2.8% lower at 249.20p in mid-morning trade following the news.

Who is James Staley?

James Staley, 59, is a former chief executive of JP Morgan Chase's investment bank. He spent more than 30 years of his career there before joining hedge fund BlueMountain Capital Management in 2013.

A longstanding lieutenant of JP Morgan chief executive Jamie Dimon, Mr Staley was at one point thought to be in line to take over as chief executive of the US bank.

It appears that it is not the first time that Mr Staley has been lined up to take the chief executive role at Barclays, following the resignation of Bob Diamond in the wake of the Libor rate-rigging scandal.

Three years ago, US business news broadcaster CNBC reported Mr Staley was, in fact, a finalist for the top job at the bank in August 2012, - alongside his colleague Bill Winters. Both eventually lost out to insider Antony Jenkins.

In 2015, Mr Staley was elected to the board of Swiss bank UBS to serve on the bank's risk committee.

Banking 'champion'

Underscoring the bank's renewed focus on investment banking, at the weekend Barclays' executive chairman John McFarlane was reported as saying European investment banks should consider merging to create a regional champion to compete with US rivals, highlighting the anxieties of senior bankers in Europe about their sector's future.

"If you did want to create an investment banking champion for Europe, you would have to combine the investment banking arms of the main players, but you would have to swallow really hard and you would need political support," Mr McFarlane told the Financial Times.

In July, Barclays bank reported a 25% rise in statutory pre-tax profits to £3.1bn for the six months to the end of June. During the period, the bank also set aside £850m to compensate customers - including cover for further claims for mis-sold payment protection insurance (PPI).

Analysis: Kamal Ahmed, BBC business editor:

Those close to the process of hiring James Staley insist he is no "Bob Diamond Mark II" and that the investment bank will still have to find savings.

The pre-2008 era is definitely over, my sources say.

Mr Staley's job will be to smooth relations between the two arms of the bank.

I am told he will retain the strategy mapped out by Mr McFarlane: cut costs by simplifying the bank's structure, re-invigorate the investment bank and jettison underperforming businesses.

At a time when most European banks are withdrawing from the investment banking sector, Barclays sees an opportunity - expanding trans-Atlantic global banking and its African operations.

It will be Mr Staley's job to realise it.

Read Kamal's blog here.