Another ex-JPM banker, ‘Venkat’, steps into Barclays hot seat
Another JP Morgan alumnus is taking the helm at Barclays. CS Venkatakrishnan, known as Venkat, was elevated to the top job at Barclays on Monday following the sudden departure of Jes Staley.
India-born Venkat, aged 55, has spent most of his career in risk management but has also spent time in investment banking and asset management, including running Barclays’ trading and markets operations for the past year and overseeing US$200bn of fixed income assets at JP Morgan. His background in risk management will be attractive to UK regulators, who still need to approve his appointment.
It was Staley who lured Venkat to Barclays in March 2016, ending 22 years at JP Morgan. Staley had started as Barclays CEO just four months earlier and Venkat was one of the first people he went for, after they worked together at the US bank. Staley has hired a raft of senior bankers from his old firm, with the promise they could probably advance further at the British bank.
So it has proved for Venkat – although his elevation to the top has probably come a year or two earlier than expected.
He was seen as one of two internal front-runners to become the next CEO, but the handover came suddenly on Monday, when Staley resigned following the outcome of a UK regulatory investigation into how he described his links with disgraced financier Jeffrey Epstein.
Venkat told staff he was taking the CEO hot seat with “deeply mixed emotions”, as his elevation had resulted from the exit of someone who had been “my manager, mentor and friend for many years”.
It is also likely to mean a move of home for Venkat – he has lived in London in the past but is currently based in New York. Barclays declined to say where he will be based but the UK regulator is likely to demand it is mostly in London.
Venkat's LinkedIn profile gives little away. His interests include MIT, JP Morgan, Barclays, California financial services app SoFi, and New York's Lincoln Center for the Performing Arts.
"Continue our existing plans..."
He has kept a low profile throughout his banking career, which sources said was in tune with his character. Born in Mysore, a city in southwest India, he obtained a bachelor’s degree, a master’s and PhD from the prestigious Massachusetts Institute of Technology. His PhD was in operations research, which is the discipline of applying advanced analytical methods, such as statistics, machine learning and probability, to make better decisions.
That was a pathway to JP Morgan, where he moved up to become chief investment officer in global fixed income in its asset management arm, and then moved into risk. In March 2012, shortly into a senior risk job at the bank, Venkat's team flagged the potential for US$6.3bn of losses from a murky derivatives trade in London, Bloomberg reported. While the analysis was dismissed, it proved prescient when the trading strategy exploded and resulted in the US$6.2bn London Whale loss, and a US Senate investigation said some losses would have been avoided if the earlier warning had been heeded, the Bloomberg report said.
Venkat joined Barclays as head of risk, and the bank has avoided mishaps in recent years. He also played a leading role in the setting up of BX, Barclays' execution services business that aligned operating systems, cut costs and improved technology and risk controls.
Barclays said on Monday it had "identified Venkat as its preferred candidate for [next CEO] over a year ago". In October 2020, it appointed him to head markets to give him greater experience of the day-to-day running of the investment bank.
Analysts said they expect a continuity of Staley’s strategy, which is doing well. Many regard Barclays as the only European bank successfully competing head-on with the big five US banks on Wall Street, alongside its strong UK retail, credit card and payments arms. Barclays shares are up 36% this year but still only trade at around half their book value.
“The strategy we have in place is the right one, and we will continue our existing plans to transform our organisation and build on our financial prowess. I know that with continued focus on delivery the best is yet to come,” Venkat told staff in a memo on Monday, seen by IFR.
Venkat is also flanked by Tushar Morzaria, another former JP Morgan executive, who has been finance chief for eight years and helped drive strategy alongside Staley.
“Venkat’s appointment, and the prompt action of the board, should ensure a good deal of continuity in the wake of this morning’s news,” said Goodbody analyst John Cronin.
As CEO, Venkat will be paid up to £9.13m (US$12.5m) a year. He will receive fixed pay of £2.7m, half in cash and half in shares; an annual bonus of up to £2.51m; a long-term incentive award of up to £3.78m; a cash payment of £135,000 in lieu of pension; and other medical and life assurance benefits.