Barclays Reaps Benefit of Diamond’s Purchase of Lehman in U.S.

From Bloomberg
By Howard Mustoe & Ambereen Choudhury
April 24, 2013

Barclays Plc (BARC) is reaping the benefit of ex-Chief Executive Officer Robert Diamond’s decision to buy Lehman Brothers Holdings Inc.’s North American unit, as the division helped to push equities revenue up 19 percent…

Cushion Decline

The increases in equities and investment banking helped to cushion a decline in revenue at the fixed income, currency and commodities business. Income fell 6 percent, the lender said, as gains linked to last year’s decision by the European Central Bank to offer firms unlimited three-year loans weren’t repeated.

Rich Ricci, who oversees the investment bank, will step down in June. The 49-year-old will be replaced by Eric Bommensath and Tom King as co-CEOs of corporate and investment banking in May. Peter Horrell, who joined the bank in 1990, will become interim head of the wealth unit, replacing Tom Kalaris.

Diamond, 61, branded the “unacceptable face of banking” by then-Business Secretary Peter Mandelson in 2010 over his compensation, quit last year in the wake of the lender’s fine for rigging the London interbank offered rate.

“Bob Diamond was the architect of the Lehman Brothers acquisition but the franchise is much bigger than a single CEO,” said Mark Williams, author of “Uncontrolled Risk,” a book on the rise and collapse of Lehman Brothers, and who teaches finance at Boston University. “Pre-crisis Lehman Brothers was a money-machine and in its Barclays reincarnation is profitable again.”

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