Barclays chief executive Antony Jenkins announced his plan to transform the troubled UK bank. He gets high marks for communication, but the substance was a little thin.
The plan involves cutting 3700 positions, about half in the investment bank, and trimming $2.8 billion in expenses, which is pretty tame for a bank with 140,000 staff and operations around the globe.
It looks more like the standard housecleaning you would expect during a cyclical downturn, not the radical restructuring that Barclays advertised. It’s nowhere close to what UBS is doing, for example. And with major achievements, like boosting return on equity, three to five years away, Jenkins is asking for a lot of patience from shareholders.
The market reacted well, sending the bank’s shares up by 8%, although that is likely more about the 2012 year-end results, which showed solid performance, particularly in the investment bank Jenkins is targeting for cuts.
In terms of communications, Barclays has put on a good show. Jenkins is speaking to the media, his points are clear and consistent and his tone has the right balance of contrition about the past and optimism for the future.
But with an underwhelming business plan, maybe the strategy to build up the significance of the announcement was not the correct one. When you don’t really have much to say, it’s best to be quick about it and let someone else take the stage.