British bank CEO quits after Epstein probe

The chief executive of British banking giant Barclays, Jes Staley, is to step down following a probe by regulators into his ties with convicted sex offender Jeffrey Epstein.

Staley’s resignation ends a controversial six-year reign at the lender.

He will be replaced as CEO by the bank’s head of global markets C.S. Venkatakrishnan, who on Monday pledged to continue his predecessor’s strategy.

Barclays said it was made aware on Friday evening of the preliminary conclusions from the Financial Conduct Authority and the Prudential Regulatory Authority’s investigation into Staley’s characterisation to Barclays of his relationship with Epstein and the subsequent description of that relationship in Barclays’ response to the regulator.

“In view of those conclusions, and Mr Staley’s intention to contest them, the Board and Mr Staley have agreed that he will step down from his role as Group Chief Executive and as a director of Barclays,” the bank said.

“It should be noted that the investigation makes no findings that Mr Staley saw, or was aware of, any of Mr Epstein’s alleged crimes, which was the central question underpinning Barclays’ support for Mr Staley following the arrest of Mr Epstein in the summer of 2019.”

The company’s shares fell two per cent following the announcement.

Barclays said last year Britain’s financial regulators were probing links between Staley and Epstein, who killed himself while awaiting trial on sex trafficking offences.

Staley has previously said his relationship with Epstein – which he says he now regrets – ended in late 2015.

He told staff in an internal memo seen by Reuters he did not want his ‘personal response’ to the investigations to be a distraction.

“Although I will not be with you for the next chapter of Barclays’ story, know that I will be cheering your success from the sidelines,” he said.

UK regulators launched their investigations into links between Staley and Epstein after another bank, JPMorgan, provided them with emails the two exchanged when Staley was the head of JPMorgan’s private bank, the Financial Times reported last year.

Barclays’ share price has fallen nine per cent since Staley became CEO in December 2015.

Britain’s financial regulators and Barclays fined Staley a combined Stg 1.1 million ($A2 million) in 2018 after he tried to identify a whistleblower who sent letters criticising a Barclays employee.