Bob Diamond (banker)

Bob Diamond
Diamond at the 2012 World Economic Forum Annual Meeting, Davos, Switzerland[1][2][3]
Born	Robert Edward Diamond, Jr. (1951-07-27) July 27, 1951[4][5] Concord, Massachusetts, U.S.[6]
Residence	New York City[7][8]
Nationality	United States United Kingdom[5][9]
Education	B.A. — Economics M.B.A. — Management
Alma mater	Colby College University of Connecticut
Occupation	Banker
Years active	1979–present
Employer	Morgan Stanley (1979–1992) CS First Boston (1992–1996) Barclays (1996–2012) Atlas Mara (2013 to date)[10]
Spouse(s)	Jennifer Diamond[6][11]
Children	Two sons and a daughter[6][11]

Robert Edward "Bob" Diamond, Jr. (born July 27, 1951)^[4] is an American banker and former group chief executive of the British bank, Barclays Plc.^[12] In 2010, he became its Deputy Group Chief Executive;^[13] and in January 2011, succeeded John Varley as Group Chief Executive of Barclays.^[14]

Diamond resigned as chief executive of Barclays after a Bank of England hearing on July 3, 2012, following controversy over manipulation of Libor interest rates by traders employed by the bank.^[15][16]

Early years and education

Bob Diamond was born in Concord, Massachusetts, on July 27, 1951.^[4] One of nine children,^[5] Diamond grew up in a family of Irish Catholic background.^[17] His parents, Anne and Robert Edward Diamond, Sr., were both teachers.^[18] He finished his schooling from Concord-Carlisle High School in 1969 and in 1973, graduated in B.A., Economics with honours from Colby College in Waterville, Maine. He was a member of the Phi Delta Theta fraternity at Colby.^[19] He was awarded an MBA from the University of Connecticut Business School, graduating first in his class.^[12]

Banking career

Early years and Morgan Stanley: 1976 to 1992

He began his career as a lecturer at the School of Business, University of Connecticut from 1976 to 1977.^[20]

Diamond then briefly worked for United States Surgical Corporation in Norwalk, Connecticut, in the IT department. There he met William B. Cook whom he later followed to Morgan Stanley.

Diamond joined Morgan Stanley in 1979 and held several positions. He rose to the post of managing director and head of fixed income trading division.^[21]

CS First Boston: 1992 to 1996

Diamond joined CS First Boston in 1992. Based in Tokyo, he was Chairman, President and Chief Executive Officer of CS First Boston Pacific, responsible for Investment Banking, Equity, Fixed Income and Foreign Exchange for the Pacific region. Diamond was formerly Vice Chairman and Head of Global Fixed Income and Foreign Exchange. Based in New York, he was a member of the Executive Board and Operating Committee.

Barclays PLC: 1996 to 2012

Diamond joined Barclays on July 4, 1996,^[20] and in September 1997 became a member of the Executive Committee of the company, Britain's second largest banking group.^[22]

Diamond was appointed chief executive of Corporate & Investment Banking and Wealth Management, comprising Barclays Capital, Barclays Corporate and Barclays Bank, and was an executive director of the boards of Barclays Plc and Barclays Bank Plc.

Diamond became a leading candidate to succeed Matthew Barrett as Group Chief Executive of Barclays Plc in 2004, but that post instead went to John Varley, who was five years younger than Diamond.^[23] In 2005, Diamond was appointed President of Barclays Plc and joined its board of directors, while also remaining Chief Executive of Barclays Capital.^[24][25]

Diamond headed Barclays' bid to purchase Lehman Brothers in September 2008, but that was stymied by the Bank of England.^[26] Diamond then sealed an agreement with Lehman Brothers President and COO Bart McDade to purchase key assets of that firm after it filed for bankruptcy, which instantly gave Barclays an investment banking foothold on Wall Street.^[27] Diamond became Deputy Group Chief Executive on October 1, 2010,^[13] and then succeeded John Varley as Group Chief Executive on January 1, 2011.^[14][28]

On July 2, 2012, Barclays' chairman, Marcus Agius, resigned following the heavy fine that Barclays suffered as a result of some of their company employees being involved in manipulating the London Interbank Offered Rate, which became known as the LIBOR scandal.^[29][30] Just 24 hours later, on July 3, Diamond resigned his post with immediate effect.^[10] Diamond's longtime protege, Jerry del Missier, who had been appointed Chief Operating Officer of Barclays on June 22, 2012, resigned on July 2, 2012.^[31]

Payment criticism

In early 2011, Barclays announced that Diamond would receive an annual bonus of £6.5 million in 2011, the largest of any CEO of a British bank.^[32] Barclays' leading investors including Standard Life, Fidelity, Aviva and Scottish Widows were shocked at Diamond's his £17.7m compensation package.^[33] In 2012, nearly a third of shareholders voted against executive pay proposals.^[34] According to a New York Times article, Diamond's pay, while considered high for a major British company, was low relative to major American banks on Wall Street. Other bank CEOs had been ousted by their board of directors, however while Diamond enjoyed the strong support of the board despite the scandal, he had been pushed out at the insistence of Mervyn King, the governor of the Bank of England.^[35]

During his tenure at Barclays, Diamond received criticism for his level of pay, his perceived lack of humility or modesty, and for being the bank's chief executive or otherwise seen as responsible, at the time a number of malpractices were identified within the bank. Ultimately it was the finding of money market rate manipulation in 2012 that was the direct trigger for his departure.

In 2010, Diamond was described as "the unacceptable face" of banking by the then business secretary Lord Mandelson, citing Diamond's high level of pay (quoted as £63 million) and lack of humility.^[36][37]

Libor scandal investigation

In June 2012, Barclays was fined £59.5 million by the FSA (£290 million in total) for "serious, widespread breaches of City rules relating to the Libor and Euribor rates".^[38][39] The bank had been found to have lied, sometimes to make a profit, and other times to make the bank look more secure during the financial crisis.^[40] The UK's Financial Services Authority (FSA), which levied a fine of £59.5 million (US$92.7 million), gave Barclays the biggest fine it had ever imposed in its history.^[41] The FSA's director of enforcement described such behaviour as "completely unacceptable", adding "Libor is an incredibly important benchmark reference rate, and it is relied on for many, many hundreds of thousands of contracts all over the world."^[40] Liberal Democrat politician Lord Oakeshott criticised Diamond, saying: "If he had any shame he would go. If the Barclays board has any backbone, they'll sack him."^[40] The U.S. Department of Justice had also been involved in the investigation.^[40] Diamond announced on June 29, 2012, that he would not resign over the bank's role in the fraud.^[42] Diamond voluntarily gave up his bonus for 2012 but initially maintained that he would remain as chief executive. However, following widespread anger at his refusal to step down and amidst concerns that his presence could be harmful to the Barclays brand, he resigned as chief executive on July 3, 2012.^[43]

According to a New York Times article published July 16, 2012, a former senior Barclays executive claimed he had received instructions from Robert Diamond to lower Libor rates after Diamond's discussions with Paul Tucker, deputy governor of the Bank of England, in which they had discussed the bank's financial position at the height of the 2008 financial crisis.^[44] Diamond, who reported that he was "sickened" by news of the Libor scandal, was surprised since Barclays had taken the advice of its lawyers to cooperate in the investigation and be first bank to settle the charges.^[35]

Resignation

Diamond's resignation under pressure was controversial. The New York Times noted that Diamond's role in the scandal was minimal and suggested that the real reason for his sacking was that he had become the "unacceptable face of banking". The Financial Times reported that "After the financial crisis, the British establishment became very divided over what's the model for the big banks that we want to see. Bob represented investment banking big time. He represented the success of it — but also the sense that investment banking is dicey and not a completely sound business. He represented a way of doing business that we've become very uncomfortable with."^[35] In March 2013, Diamond was set to be paid about £2m ($3m) in July, a year after he left the bank following its Libor interest rate fixing scandal.^[45]

Atlas Mara Limited: 2013 to date

On November 28, 2013, Diamond and entrepreneur Ashish Thakkar founded Atlas Mara, a company whose geographical area of focus is banking in the African continent.^[46] The company was listed on the Alternative Investment Market in the UK on December 17, 2013 through an IPO which raised USD 325 million

Personal life

Diamond married his wife, Jennifer, an engineer from Michigan, in 1983.^[47] They have three children. He is an avid sports fan, supporting the Red Sox in Baseball, Chelsea F.C. in soccer, the New England Patriots in American football, and the Boston Celtics in Basketball. Diamond is a Republican^[48] and was an adviser to Conservative Mayor of London Boris Johnson in 2008.^[49]

Diamond is chairman of the board of trustees of Colby College in Waterville, Maine; chairman of Old Vic Productions Plc; trustee of The Mayor's Fund for London; he was a member of the advisory board, Judge Business School at Cambridge University; member of International Advisory Board, British–American Business Council; life member of the Council on Foreign Relations; and member of the Atlantic Council.^[20]

Diamond, along with his wife Jennifer, is a founding circle member of The Nantucket Project, an annual festival of ideas on Nantucket, Massachusetts.^[50]

In 2011 he was included in the 50 Most Influential ranking of Bloomberg Markets Magazine before his ethics problems appeared and the Bank of England terminated his employment at Barclays.^[51]

References

External links

• Profile at Barclays PLC: link dead as of July 4, 2012.
• Barclays Group Archives: Bob Diamond