You can’t keep an investment banker down, especially if he is near the top of of a European universal bank. That is the moral of Bob Diamond’s emergence as the next chief executive of Barclays, despite having been declared the “unacceptable face” of banking by Peter Mandelson.
Mr Diamond’s appointment as the next chief executive of Barclays means that investment bankers will now head four of the biggest European banks with global reach.
Mr Diamond joins Josef Ackermann at Deutsche Bank, Oswald Grübel at UBS and Brady Dougan at Credit Suisse. Despite the massive losses incurred by the corporate banking arms of some commercial banks -including UBS – during the 2008 crisis, investment bankers remain in charge.
This does seem odd, given that the retail banking sides of universal banks were relatively blameless during the crisis. You might have thought that the retail bankers would have reasserted control over the highly-rewarded risk-takers.
Instead, the boards of banks clearly think that investment banking will stay a vital part of their businesses, and they need people at the top who understand it.
Mr Diamond, who built up Barclays Capital more or less from scratch, no doubt deserves his prize, but the hegemony of investment bankers is breathtaking.
