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* Staley resigns after probes into Epstein ties
* Replaced by C.S. Venkatakrishnan
* Staley says will contest regulators' findings
(Adds share reaction, CEO memo)
By Rachel Armstrong, Carolyn Cohn and Lawrence White
LONDON, Nov 1 (Reuters) - Barclays chief executive
Jes Staley is to step down following a probe by British
regulators into his ties with convicted sex offender Jeffrey
Epstein, ending a controversial six year reign at the lender
marked by his successful backing of its investment bank against
an activist investor.
Staley will be replaced as CEO by the bank's head of global
markets C.S. Venkatakrishnan, who on Monday pledged to continue
his predecessor's strategy.
Barclays said it was made aware on Friday evening of the
preliminary conclusions from the Financial Conduct Authority and
the Prudential Regulatory Authority's investigation into
Staley's characterisation to Barclays of his relationship with
Epstein and the subsequent description of that relationship in
Barclays' response to the regulator.
"In view of those conclusions, and Mr Staley's intention to
contest them, the Board and Mr Staley have agreed that he will
step down from his role as Group Chief Executive and as a
director of Barclays," the bank said.
"It should be noted that the investigation makes no findings
that Mr Staley saw, or was aware of, any of Mr Epstein's alleged
crimes, which was the central question underpinning Barclays'
support for Mr Staley following the arrest of Mr Epstein in the
summer of 2019."
Barclays shares fell 2% following the announcement.
Barclays said last year that Britain's financial regulators
were probing links between Staley and Epstein, who killed
himself while awaiting trial on sex trafficking offences. Staley
has previously said his relationship with Epstein, which he now
regrets, ended in late 2015.
The FCA and PRA said in a statement they could not comment
further on the Epstein investigation.
Staley told staff in an internal memo seen by Reuters that
he did not want his 'personal response' to the investigations to
be a distraction.
"Although I will not be with you for the next chapter of
Barclays' story, know that I will be cheering your success from
the sidelines," he said.
In a separate internal memo also seen by Reuters,
Venkatakrishnan, known as Venkat, told staff the strategy put in
place by Staley at Barclays was the "right one", although he
added that he would announce changes to the organisation of the
corporate and investment bank in the coming days.
UK regulators launched their investigations https://www.reuters.com/article/us-barclays-results-idUSKBN2070NF
into links between Staley and Epstein after JPMorgan
provided them with emails the two exchanged when Staley was the
head of JPMorgan’s private bank, the Financial Times reported
last year.
The bank's share price has fallen 9% since Staley became CEO
in December 2015.
Barclays fought off a campaign launched by activist investor
Edward Bramson in 2018 to have Staley removed. Bramson sold his
stake earlier this year.
Britain's financial regulators and Barclays fined Staley a
combined 1.1 million pounds ($1.50 million) in 2018 after he
tried to identify a whistleblower who sent letters criticising a
Barclays employee.
(Reporting by Rachel Armstrong, Carolyn Cohn and Lawrence
White; editing by Louise Heavens, Kirsten Donovan)
