Barclays' little story and how it changed banking culture

Top City boys queue up, two by two, for a grilling.

This week has seen top City boys queuing up, two-by-two, as the Parliamentary Commission on Banking Standards (PCBS) called them in for a grilling on UK banking standards, rate-rigging scandals and big fat cheques.

In the firing line this morning was Anthony Jenkins and Sir David Walker, Barclay’s group chief executive and chairman, after Lloyds’ on Monday.

During an intense three-hour inquiry, Jenkins told the committee he was “shredding” the legacy left by his former boss Bob Diamond, after (quite publicly) rebuffing a £2.75m bonus having decided it would be “wrong” to receive a cheque too fully-loaded.

It is still far too early to see whether there has been any material change in Barclays’ culture. Rome wasn’t built, or-re-built in a day, and the jury will still be left with a few big questions over the British bank’s cultural DNA after today’s session.

Diamond on his part had received a £2.7m annual bonus for 2011, a pay check of £17m (with the bank paying also his £5.7 tax bill) after resigning amid the interest rate rigging scandal.

The boss was known to lead an "aggressive" and "self-serving" culture in the bank, the committee heard, while hush-hush talks in the City from former Barclays’ people push it a bit further, describing it as “rotten”.

The multimillion-bounty led to the forced resignation of Alison Carnwath, former chairman of the Barclays remuneration committee, who claimed to have been the lone voice for Diamond receiving "zero" bonus.

Along with Walker, Jenkins announced, avoided –and confessed- a few things.

The Committee jumped at the chance to enquire about The Bonus, remuneration and more specifically Sir John Sunderland, the man in control of it –he who replaces Mrs Carnwath.

“The problem we have with [Sunderland’s] evidence is that he didn’t think he had made a mistake (in regards to Bob Diamond's pay off), even in retrospect?” the committee asked.

“You'll have to trust my judgement,” replied Walker, in what looked more and more like a battledome.

Walker and Jenkins informed the MPs of a bonus slim down at Barclays following yet another £1bn provision to cover compensation for interest rate swap products and mis-selling of payment protection insurance (PPI).

According to Barclays, the scandal-hit year is now costing the bank around £2.6bn in compensation: PPI damages will go to borrowers who were (mis-)sold loan insurances (to protect them if they missed repayments due to illness or redundancy), but were not actually eligible to claim it.

During the tense discussion, Jenkins let out that he would step down if there was a regulatory failing under his watch.

This comment seemed too trouble-free for the Committee not to pick upon: Jenkins was head of Barclaycard from 2006, and throughout the time PPI products were sold.

“We worked hard to modify PPI products and we didn't get it right completely” was what Jenkins had to answer. He added: “it's a question of proportionality.”

This answer baffled the Committee; but not as much as when he spoke about the LIBOR-fixing –which cost the bank $450m in fines. “I first learnt about Libor on the day the Libor fine was announced,” he said.

When the committee asked him if he questioned the banking culture while working closely with Diamond, Jenkins took the time before calmly answering, “Yes.”

What he meant by this assent, was that he had been arguing “for a change in culture since 2012.”

Rumours were sparked by Committee chairman Andrew Tyrie when he said it was possible the Barclays bosses would be called in before the Committee again.

But next in line for the grilling are JP Morgan and HSBC’s heads, who will give the Committee more to query until their new report is published.

Photograph: Getty Images

Elsa Buchanan writes for VRL Financial News

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No, straight couples don't face marriage discrimination

The couple are right in law, but their complaint is ill-judged and tone-deaf. 

The Court of Appeal has struck down the case of a heterosexual couple - Rebecca Steinfeld and Charles Keidan seeking to have a civil partnership. The couple in question say they are the victims of discrimination. Are they right?

The legal question is more complex than the headlines. The government’s position is that they are waiting and seeing what the introduction of equal marriage means for the future of civil partnerships. Either civil partnerships will cease to be an option for same-sex couples or they will be extended to everyone. Judges were divided as to whether or not they should leave it for the government to decide that, or if civil partnerships should be extended to heterosexual couples. They opted to leave it to parliament, albeit by a narrow margin.

Legally, the judges agree, that the state of affairs creates a system where the law treats heterosexual and homosexual couples differently, and that this should be ended. And as far as the law is concerned, I agree. But emotionally and morally, the case of Steinfeld and Keidan stick in my craw.
Let’s remember why civil partnerships were created: to allow same-sex couples to access some of the legal protections extended to heterosexual couples in a way that could pass through the Houses of Parliament without being bogged down in too many battles with religious conservatives.

The rights that are not extended to civil partners include: a prohibition on religious readings, music or symbols. They cannot take place in religious venues, regardless of the beliefs of the owners’ rights. And people in a civil partnership cannot describe themselves as “married” on legal documents. There is no provision for separation as a result of adultery.

The rights not enjoyed by married couples in civil partnerships are: the ability to have private ceremonies without witnesses present. The reason why heterosexual marriages include provision for witnesses is the existence of forced heterosexual marriages in the United Kingdom, a rare example of a legal distinction based upon the sexuality of a couple that is grounded in fact, not prejudice or mumbo-jumbo. There is still no recognition for adultery in same-sex relationships in English law, whether you are married or in a civil partnership.  Equal marriage still has yet to be extended to Northern Ireland.

But if you are a heterosexual couple and you want to have a civil union that eschews religious messages, or patriarchal tropes, from being walked down the aisle by your father to the presence of a white wedding dress, you can. If you dislike the phrase “husband” or the word “wife”, you can use whatever word you like, in a social and a legal context. Don’t forget, too, that the courts have ruled recently in favour of couples in longstanding partnerships outside of marriage being able to access pension and other survivor benefits.

So while there is discrimination as a matter of law, it is hard to see how there is discrimination as a matter of fact for heterosexual couples. There is, however, a continuing discrimination towards homosexual couples in the divorce courts and in Northern Ireland.

It seems particularly ill-judged to claim discrimination while using the courts to gain access to an institution created as a pathway to the rights you already enjoy and can freely access, crowdfunding £35,000 along the way, particularly while there is still genuine marriage inequality between heterosexual and homosexual couples. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.