Barclays Finance Chief Resigns Earlier on Health Reasons
Barclays Plc (BARC), the U.K.’s second-largest bank by assets, said Chief Financial Officer Chris Lucas will resign for health reasons at the end of this week, six months earlier than planned.
Lucas, 52, will step down from the board and as group finance director on Aug. 16, the London-based company said in a statement today. Peter Estlin, group financial controller, will be acting chief financial officer until Oct. 15, when Tushar Morzaria, 44, will take over the post.
“Whilst I am saddened that his health has forced this decision on him sooner than either of us would have wished, I respect his decision and wish him well in the future,” Barclays Chairman David Walker said in the statement. “He has successfully navigated Barclays’s finances through one of the most difficult periods in its history.”
Lucas, the last of former Chief Executive Officer Robert Diamond’s senior managers to depart, is leaving ahead of a planned 5.8 billion-pound ($9 billion) rights offering, which stands to be the biggest by a U.K. bank since Lloyds Banking Group Plc (LLOY)’s 13.5 billion-pound sale in 2009. CEO Antony Jenkins, 52, is selling the shares after financial regulators identified a 12.8 billion-pound capital hole at the bank.
It’s “unhelpful timing for Barclays,” said Ian Gordon, an analyst at Investec Plc (INVP) in London, who has a buy recommendation on the shares. However, there should be “no impact” on the rights issue next month, he said.
Barclays gained 0.6 percent to 285.45 pence in London today. The shares have increased 8.7 percent this year.
Morzaria, the executive hired last month from JPMorgan Chase & Co., will join the board on Oct. 15, Barclays said. Lucas, who had initially planned to retire in February, cited his health as a “key factor” behind his decision.
“I want to do the right thing by Barclays, my family, and myself, and therefore I have reached the difficult decision to step down sooner,” Lucas said in the statement. “I feel confident that I leave Barclays financially robust and well placed to continue to serve its customers, clients, shareholders and other stakeholders.”
Lucas was among four past and present employees to be probed by regulators over whether Barclays adequately disclosed fees paid to the Qatar Investment Authority as part of a 7 billion-pound fundraising during the financial crisis, a move that helped the lender avoid taking government money. Barclays said last month that it’s contesting the probe’s findings.
Barclays’s first-half profit was reduced by 640 million pounds of restructuring costs linked to Jenkins’s overhaul of the lender to make it more profitable. The CEO is seeking to cut 1.7 billion pounds in annual expenses by 2015, eliminating 3,700 jobs and reduce costs to about 55 percent of income from 71 percent in the first quarter of 2013.
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