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John McFarlane profile: 'Mack the Knife' wields his blade at Barclays


Jim Armitage
Thursday 09 July 2015 01:37 BST

Perhaps it was his first big break, working for Citicorp in the 1980s, that taught John McFarlane when to pull out his stiletto blade. Citi put him in charge of the London investment bank it had created at great expense by merging two UK equities shops into Scrimgeour Vickers.

He quickly realised the business was too small to reach critical mass without running up absurd costs and urged his Citi bosses to cut their losses and get out. But they refused, kept with the business and wasted millions until finally giving up the ghost years later.

It taught the 67-year-old Scotsman the need to keep companies simple and cut out the costly, slow growing bits.

In his next big job, he didn’t have large US egos to worry about. As chief executive of Australia and New Zealand Banking Group, he reduced the investment bank, focusing on its retail banking division. The result: a tripling of the share price.

It was the first time he earned the soubriquet of “Mack the Knife”.

He advocated similar treatment at RBS, which he joined in 2008. Kill the investment bank, he urged, and get back to basic high street banking. He was ignored until two years ago, after he was long gone, when his advice was finally heeded.

But it was at Aviva that he really earned his moniker. He arrived as chairman designate of a business that investors felt had been badly led by chief executive Andrew Moss. Five months later, a pay revolt in the “shareholder spring” of 2012 persuaded Mr McFarlane there was no option: he had to oust Mr Moss and run the business himself. The blow was struck the day before Mr Moss’s wedding.

Barely pausing to wipe the blade, Mr McFarlane was soon swinging it around Aviva, selling non-core businesses and hacking away at the layers of management.

Given Mr McFarlane’s track record, rumours he was dusting down the sharpening steel again for Antony Jenkins started the day he became Barclays chairman two months ago. But the speed with which he moved shocked even his closest followers.

There is no doubt: Mack the Knife is back.

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