'The intensity of this public reaction has overwhelmed us and we would be foolish if we did not understand how serious it is and what we have got to do about it,’ he said.
But this scandal ain't going away any time soon, with ongoing probes likely to lead to more admissions of wrongdoing by firms in the UK, Europe and on Wall Street. And, because of its crazy decision to be the first to settle, Barclays (rightly or wrongly) has become the poster child for all that is bad with the industry.
Bankers, of course, have been in relative disgrace since the financial crisis of 2008, and every new scandal makes every large bonus payout harder to justify. And that's now a huge problem for Barclays, and particularly for the investment banking unit that was until recently known as Barclays Capital.
The outcry that has followed Barclays' involvement in the rate-rigging decable has been hugely significant, mainly because it is the result of a cumulative effect of scandals that have negatively impacted the industry over the last 4 years. So now, given this mass feeling of ill-will to the industry, and particularly to Barclays for being the first to own up, it is difficult to see how the UK bank can justify paying out bonuses to bankers - and certainly not this year-end, when feelings will remain raw.
So what does this mean for those who work in investment banking at Barclays ? Well, facing the prospect of lower compensation, surely it means that a lot of the top talent will soon be seeking pastures new. Now in circumstances like these, where there is a degree of uncertainty about a business franchise, a firm would usually pay retention bonuses to lock in its staff. But this would be politically unacceptable for Barclays to do at this time, and so ain't gonna happen.
Longer term, we are almost certainly looking at the investment bank being renamed and spun-off (there were stories in the press last weekend indicating that the Barclays board would consider a plan for the investment bank to be listed in New York). But this, too, won't be easy. Investors may well be wary of putting their money in a stand-alone investment bank at this time, in a challenging market, and with a lot of uncertainty over the impact of regulation and new capital rules.
'Dead man walking, that how I'd describe the old BarCap businesses now', one banker told Here Is The City. 'Why would you want to go work there, and why, if you had the choice, would you want to stay ?'.
image: © seher sikandar