View from City Road: Taylor convinces that Barclays is on the mend
Friday 11 March 1994
He wants a separately identifiable group executive headquarters to remove confusion between the senior management and the clearing bank, and he worries that Barclays is not organised enough along customer lines. The bank and BZW are also too polarised.
On finances, there will be no rights issue while Mr Taylor is chief executive. But with profits recovering fast, Barclays has started a strategic study of its capital needs. Should the bank hoard capital either to spend on what he called 'reckless adventures' or as a cushion for future problems?
He implied that, whatever happened, it should not be handed back in huge dollops to shareholders. The old game of asking shareholders for rights issues and giving it back in high dividends was over. He did not believe Barclays' future dividends should be much more than twice covered by earnings.
This time cover was 1.3, but retained profits would have to double to get to a two times covered dividend at the old level, before it was slashed. Restoration of the former dividend will be a tall order this year, though a smaller increase is likely.
Mr Taylor also confirmed, as the Independent reported in January, that the bank is planning to make bad debt provisions based on an analysis of the general risk of default for the type of borrower, rather than the customer's individual credit rating.
This is not to smooth out profits over a cycle, he said. The key objective is to encourage bank managers to price their loans better - an actuary's view of bank risk, already applied to Barclaycard. The trick is to extend it to high-volume commercial lending.
Most important, Mr Taylor wants to change the bank to a 'can do' culture: less formal, more open to outsiders, and judging people by their contribution not their status. (That applies in buckets already at bonus-laden BZW.) Promises, promises, but convincingly put. Barclays is on the mend.
Exclusive: World’s most pristine waters are polluted by US Navy human waste
Missing Malaysia Airlines Flight MH370: Any terrorist seizure of the plane ‘would have required one hell of a piece of planning’
Croatia's second city to close 'worst zoo in the world' after reports of 'nightmare' conditions and 'depressed' animals
Missing Malaysia Airlines Flight MH370: Hijackers, pirates or suicide – the theories surrounding the mystery
Oscar Pistorius trial: Photographs of Paralympian splattered in blood after Reeva Steenkamp shooting shown in court
Katie Hopkins continues campaign to become Britain's most hated talking head with poorly timed Bob Crow tweet
No EU referendum under Labour: Ed Miliband to reveal that vote on membership is ‘unlikely’ in next Parliament if party wins power
Grace Dent: Who cares if she spells it Barraco Barner? Gemma Worrall is more employable than some bookish arts graduate
The rise of Ukip: Study warns Labour that Eurosceptic party's electoral base now 'more working class than any of the main parties'
Europeans have ‘got whiter’ due to natural selection in past 5,000 years, scientists say
Fracking is turning the US into a bigger oil producer than Saudi Arabia
- 1 Is your name now 'banned' in Saudi Arabia?
- 2 Exclusive: World’s most pristine waters are polluted by US Navy human waste
- 3 Nemanja Matic interview: My family were in tears when we left Lisbon
- 4 Missing Malaysia Airlines Flight MH370: Jet ‘hijacking’ began soon after take-off
- 5 'Missing Malaysia Airlines Flight MH370 plane found in Bermuda Triangle!' Facebook links are profiting hackers
iJobs Money & Business
£35000 - £43000 per annum + Bonus and Benefits: Harrington Starr: A global lea...
£50000 - £60000 per annum: Harrington Starr: Linux Systems Administrator - UNI...
£32000 - £36000 per annum + generous benefits: Pro-Recruitment Group: * TAX * ...
£37000 - £40000 per annum + £20000 benefits package: Pro-Recruitment Group: **...