Rich Ricci is leaving Barclays (BCS 1.42%), and the bank will never be the same again. Or at least it won't be nearly as hilarious. It was like if Sack Tackler was a football player. Anyways, Ricci had been head of the bank's investment arm since Bob Diamond -- I know, it just keeps going -- stepped up to fill the CEO role. Ricci's exit has been viewed as one of the last steps in distancing the old Barclays from the new Barclays.
The old Barclays was fined for rigging the LIBOR, bought Lehman Brothers for a song, and was involved in every insurance scandal the U.K. has managed to drag up. The new Barclays is cooperating with investigators and making third-party investigations public. How times have changed.
Cutting the ties
Barclays' new CEO, Antony Jenkins, has made more progress than anyone expected. In the last few months, the bank has made real steps toward honesty about its past failings and instead of justifying them, has accepted their weight. In February, the bank increased the amount set aside to pay out to customers who were missold insurance products and rate swaps in the late 2000s.
One of Jenkins' main goals is to remove the layers of structure that kept previous CEOs insulated from problems on the front lines. Diamond, who stepped down last year, had insisted that he didn't know that rates were being manipulated. Jenkins new plan appears to ensure that next time something goes wrong, management will have to know.
Ricci was close to Diamond throughout the LIBOR period, but due to luck or position managed to hang on at Barclays longer than his former boss. Jenkins has apparently decided that the bank can't fully move forward with Ricci still around.
The good feelings emanating from the bank seem to have made investors happy. The stock is up 47% since Jenkins took the CEO role, and it's beat out both the Royal Bank of Scotland (NWG 0.38%) and Lloyds Banking (LYG 1.89%) handily. But all three firms are staring down the unknown costs associated with current misselling scandals. Analysts have said that the overall cost could run to 10 billion pounds.
While Barclays recently jumped up in customer satisfaction, according to the National Customer Satisfaction Index, it still lags behind HSBC and Lloyds. This year's actions will be important for the future of the bank. If it can manage its losses from litigation, the steps it's already taken to distance itself from itself may make the difference.
But if financial fortunes turn against it, Barclays may find itself again in the position of making the right choice for everyone, or making the right choice for shareholders. It would be nice to see those coincide more often at all of the banks. Here's hoping Barclays can map a path for everyone.