Outlook: RBS merger may be best for Barclays
Wednesday 14 April 1999
Since a merger with National Westminster Bank, or any other "English" clearer, is almost bound to be ruled out on competition grounds, the only obvious candidates would be the two Scottish banks, of which Royal Bank of Scotland must be the front runner. With a market capitalisation of little more than half that of Barclays, any such proposal would essentially have to be framed as a management buy-in, or reverse takeover. Demoralised, bemused and out to lunch though what is left of the Barclays board might be, is this something it could reasonably contemplate?
Certainly Sir George Mathewson, Royal Bank of Scotland's chief executive, is ambitious and accomplished enough to pull it off. The cost savings to be had from such a combination would plainly not be as dramatic as with an English clearer, but in retail banking and corporate lending they might still add up to several hundred million annually. Furthermore, it would provide some kind of a solution to the problem of who to lead Barclays into the next millennium.
Barclays' chances of attracting another top notch banker from the US like Mike O'Neill would seem to be slim. Even if one were available for hire at short notice, nobody likes being second choice, and in any case, nearly everyone who's any good is locked into US remuneration packages that would make any such acquisition prohibitively expensive. Executives of Mike O'Neill's ability who are also prepared to do the job at a reasonable rate, are in short supply.
Sir George would undoubtedly have been on Barclays' original shopping list for the job, but there would be no good reason for Sir George, at this relatively late stage in his career, to ditch his Edinburgh power base for the snakepit of London. If he could bring it with him, however, that might be a different matter.
The only probable alternative to Barclays' management problems would appear to be an internally groomed candidate, but even if there is someone of sufficient calibre waiting in the wings, this solution is unlikely to be as pleasing to the City as a fully fledged merger.
Martin Taylor, the previous chief executive, always believed a further big consolidation of British banking inevitable, and during his time at Barclays he made several failed attempts to bring it about. It's ironic, but by walking out in the way he did and prompting the present vacuum in leadership, Mr Taylor may end up achieving his aim afterall.
- 1 Chelsea victory parade mocked on Twitter as 'tens of fans' pack the streets of London
- 2 Preston fan who appeared to snatch Jermaine Beckford's shirt from eight-year-old boy identified and says: 'the truth will come out'
- 3 Johnny Depp facing 10 years in jail for illegally bringing dogs to Australia
- 4 US warned by Chinese media to stop meddling or 'war will be inevitable'
- 5 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
Cyclist who knocked down three-year-old girl says his life has been 'destroyed'
Australian man punched in the face for defending Muslim women from abuse on train
Johnny Depp facing 10 years in jail for illegally bringing dogs to Australia
US warned by Chinese media to stop meddling or 'war will be inevitable'
Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
EU referendum: David Cameron's rules are a 'democratic disgrace', says French-born Scottish politician set to be denied a vote
The day that Britain resigned as a global power
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
A nation of inequality: How the UK is failing to feed its most vulnerable people
iJobs Money & Business
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...
£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...
£16 - 20k: Guru Careers: A Graduate Editor / Editorial Assistant is needed to ...
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...