Another JP Morgan alumnus is taking the helm at Barclays. CS Venkatakrishnan, known as Venkat, took the top job at Barclays last week following the sudden departure of his mentor Jes Staley.
India-born Venkatakrishnan, 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 Venkatakrishnan to Barclays in March 2016, ending 22 years at JP Morgan. Staley had started as Barclays CEO just four months earlier and Venkatakrishnan was one of the first people he went for, after they worked together at the US bank. Staley lured 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 Venkatakrishnan. He was regarded as one of two internal frontrunners to become the next CEO, but his elevation to the top has probably come a year or two earlier than expected. Staley resigned following the outcome of a UK regulatory investigation into how he described his links with disgraced financier Jeffrey Epstein.
It took Venkatakrishnan by surprise, as well as investors. Just five days before his promotion, the executive sold £390,900 shares in Barclays, according to a regulatory filing. Often, new bosses buy shares as a show of commitment, especially when they get a bumper pay rise. As CEO, Venkatakrishnan will be paid up to £9.13m (US$12.5m) a year.
Venkatakrishnan told staff he was taking the CEO hot seat with “deeply mixed emotions” as it came about from Staley's exit. "Jes has been my manager, mentor and friend for many years," he said.
People who have worked with Venkatakrishnan say he is thoughtful, warm and kept a low profile. He is married with three daughters. His LinkedIn profile gives little away – his listed interests are the Massachusetts Institute of Technology, JP Morgan, Barclays, California financial services app SoFi, and New York's Lincoln Center for the Performing Arts.
He is based in New York, but has lived in London in the past, and is expected to move back to the UK capital, but spend much of his time in New York.
"Best is yet to come..."
Born in Mysore, a city in southwest India, Venkatakrishnan obtained a bachelor’s degree, a master’s and PhD from the prestigious MIT. 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, Venkatakrishnan's team flagged potentially big losses from a murky derivatives trade in London, Bloomberg reported. The analysis was dismissed, but 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 warning had been heeded, the Bloomberg report said.
Venkatakrishnan 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 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 expected a continuity of Staley’s strategy, which was 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,” Venkatakrishnan told staff in the memo, seen by IFR.
Venkatakrishnan 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,” said Goodbody analyst John Cronin.