Now that Barclays is officially creating a bad bank and Skip McGee is officially leaving Lehman, Barclays is changing. Fixed income is going down. Big swinging bankers are going down. Equities salespeople and traders and advisory bankers are going up. Self-effacing types who don’t dance in the limelight and demand huge pay for themselves and their key acolytes seem to be going up too.
McGee’s exit from Barclays reportedly comes after he was refused a promotion into the investment banking CEO role now occupied by Tom King. Like McGee, King is a dyed-in-the wool U.S. investment banker. Unlike McGee, King has been relatively low-key. King joined Salomon’s U.S. M&A business in 1989 and went on to become global head of M&A at Citigroup, where he was based out of London from 2000. When King left Citi for Barclays in 2010 he was lauded as a, ‘highly intelligent banker with an understated style.’ “CEOs took to his quiet, thoughtful and intellectual style,” Michael Kirkwood, chairman of Ondra Partners and a former colleague of King’s told Financial News at the time. Texan-born McGee, on the other hand, has a reputation for brashness. He reportedly pushed for Lehman Brothers to take on more risk back in 2005 and 2006 and wrote a ranty letter to his son’s school objecting to ‘negative gender stereotyping.’
Power struggles and pay petitions
Now that McGee’s gone in a fit of pique, it looks a lot like he King were engaged in a power struggle at Barclays since at least late 2012.
King joined the British bank as co-head of global corporate finance and sole head of the EMEA investment banking division in December 2009. When King arrived, McGee was already installed from Lehman as head of global investment banking at Barclays and was therefore nominally his boss. In a restructuring in October 2012, however, McGee was ‘promoted’ to become chief executive of corporate and investment banking in the Americas and King was promoted into McGee’s old role as global head of investment banking. Reporting lines were blurred in the process.
King’s ascendance over McGee was confirmed in April 2013 when he was made co-head of the entire investment bank. We now know that this happened only a few months after McGee had negotiated generous retention bonuses for several of his US traders, who were allegedly about to leave the bank for higher paying rivals.
It’s easy to see why the mild-mannered Antony Jenkins might be more drawn to working with the thoughtful King than the hard-driving brash McGee. King’s enthronement could spell a shift in the culture at Barclays, which the ex-Lehmanites there would do well to acknowledge. This applies as much to the equities sales and trading business as to fixed income. In London, Barclays’ equities business is home to the likes of Richard Evans and Richard Carson, both former heavyweight equities traders who’ve been happy to take important jobs behind the scenes (Evans as equities COO and Carson as European head of equity market risk). Maybe this is the way things will be at Barclays from now on.