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New Barclays CEO C.S. Venkatakrishnan takes the helm amid a sweeping digital shakeup

CEO comes with a reputation for prescience, after spotting "London Whale" issues...

New Barclays CEO C.S. Venkatakrishnan, widely known as Venkat, has taken the helm at Barclays, after outgoing Chief Executive Jes Staley resigned on November 1 amid an ongoing dispute with financial regulators over how he described his ties with convicted sex offender Jeffrey Epstein. He joins as outgoing CEO Staley emphasised the "imperative for Barclays to continue investing in new digital architecture" in the bank's annual report -- a digital overhaul is being led by Group CIO Craig Braight, who joined the bank from Australia's WestPac in October 2020 and who has won plaudits for his efforts to champion women in technology working at the bank.

New Barclays CEO C.S. Venkatakrishnan joins as Barclays continues to prioritise what it described in its 2020 annual report as "less capital intensive, technology-led, annuity businesses" with key challenges described as delivering a "better, more digital bank for consumers and small businesses... finding further efficiencies through technology and automation, and creating new business models and partnerships based on digital engagement."

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Like most High Street banks, Barclays remains challenged by technical debt and has been struggling to catch up with the capabilities of more digitally native banks -- it only rolled out the ability to provide "enhanced payment alerts, and... itemised digital receipts" in 2021 (the latter via a partnership with Fintech Flux) for example and can be regularly spotted recruiting for mainframe engineers: approximately 30% of the banks' products meanwhile are still not available via a digital channel. Yet the new Barclays CEO joins a bank in robust health, having just reported record quartely profits (before tax) of £6.9 billion and investing substantially in modernising.

(Its Q3, 2021 earnings include a charge of £266 million, in part due to "costs associated with the discontinued use of software assets" as it tackles technical debt, and it has cut operational costs by 6% year-on-year.)

See also: JPMorgan's Global CIO Lori Beer joins The Stack to talk tech talent, resilience, and hybrid architectures

Former JPMorgan executive Venkat pledged in a LinkedIn post today (November 9) to stay focussed on building up "a leading international corporate and investment banking business, a strong UK and US consumer franchise, and a growing payments business" while using Barclays' "expertise to help the transition to net zero, and... build a more diverse organization". (He started by "acknowledging the tremendous job Jes Staley did in transforming the organisation and the hard work of all my colleagues" -- he was recruited by Staley and has been at the bank for six years, most recently as Global Head of Markets, previously leading Risk as CRO.

The new CEO, who carries a reputation for geniality and a rare combination of capabilities across both risk/regulation and the technicalities of trading,  has a reputation for prescience.

In March 2012, as Bloomberg earlier reported, just weeks into a senior risk job at JPMorgan, his team "flagged the potential for $6.3 billion of losses from a murky derivatives trade in London" -- an analysis reportedly dismissed as “garbage” by the risk officer at the JPMorgan department responsible for the trades. The trading strategy his team had spotted did indeed implode in style, giving rise to a $6.2 billion loss for JPMorgan by the so-called "London Whale".  A US Senate investigation later said losses would have been avoided if the Whale’s unit had heeded Venkat’s warning, noting: "The CIO, traders, risk personnel, and management discounted the CRM’s [a key risk metric] warning. They simply did not believe that [they] could be risking a $6.3 billion loss. By the time Mr. Venkatakrishnan prevailed upon [them] to accept the accuracy of the bank’s CRM model, it was too late."