Jenkins, 51, replaces Barclays veteran Bob Diamond, the once highly regarded executive who built up its investment banking unit into a major force but left suddenly in July after the institution agreed to pay $450 million to settle civil cases in the U.S. and U.K. concerning LIBOR rigging. Diamond's departure and the LIBOR-rigging and other problems at Barclays' investment banking unit fueled speculation the London bank could demerge that business. That speculation may increase with Jenkins' appointment, though Barclays denies a separation of investment banking is in the cards and some see the bank as more likely to gradually shrink the division.
"We estimate the investment bank would require an additional £11 billion of equity to make it Basel 3 compliant today, requiring a rights issue. We therefore see reallocation of capital and gradual deleveraging as the more likely strategy for the investment bank," wrote Oriel Securities Ltd.'s Mike Trippitt and Vivek Raja.
A Barclays spokeswoman said: "Antony has been very clear that he supports the universal banking model."
Jenkins is now the CEO for Barclays' retail and business division, including Barclays' operations in Africa, which it is currently trying to consolidate within its majority owned Absa Group Ltd. unit in South Africa. He has been on Barclays' executive committee since 1999 and began his career at the institution in 1983 before moving to Citigroup Inc. six years later, where he worked in London and New York.
Jenkins' appointment follows that of David Walker as chairman early this month. Walker will in November replace Marcus Agius, who also stood down because of the LIBOR scandal. Jenkins becomes CEO with immediate effect.
In a statement, Walker said it was "clear that Antony was the outstanding choice. His track record, familiarity with the group and vision for the future are all highly compelling."
Jenkins begins his tenure just as the Serious Fraud Office starts an investigation into the £7.3 billion ($11.6 billion) funding the bank secured from mainly Middle Eastern investors in late 2008. The financing, which was initially criticized by Barclays' existing investors before the bank amended the terms, allowed it to avoid a state bailout during the credit crisis.
Barclays said Wednesday that the SFO investigation, which isn't targeting individuals at the bank, centered on "payments under certain commercial agreements between Barclays and Qatar Holding LLC." It declined to comment further.
The SFO is already investigating the LIBOR rigging following Barclays' civil settlement with transatlantic regulators in June. In late July Barclays disclosed the Financial Services Authority is investigating finance director Chris Lucas and other current and former executives over disclosures made around the time of the 2008 fundraising.
Alluding to Barclays' travails, Jenkins said in a statement that the bank had "made serious mistakes in recent years and clearly failed to keep pace with our stakeholders' expectations."
"We have an obligation to all of those stakeholders - customers, clients, shareholders, colleagues and broader society - and a unique opportunity to restore Barclays reputation by making it the "go to" bank in all of our chosen markets," he said. "That journey will take time, we have much to do, and I look forward to getting started immediately."
Jenkins will begin by reviewing Barclays' entire business, including the operations' cost base and return on equity, a person familiar with the situation said.
Barclays shares early Thursday were down 3.15 pence, or 1.7%, at 183.2 pence, giving the bank a market value of £22.4 billion.
Oriel Securities' Trippitt and Raja suggested external candidates, which reportedly included JPMorgan & Co. former investment banking co-head Bill Winters, were probably put off by Barclays' legal and regulatory woes.
Daniel Stewart & Co. analyst Simon Willis wrote that Jenkins appeared to be "a safe pair of hands but we suspect that Barclays' business will be a lower ROE (return on equity) business going forward."
Alvarez & Marsal tapped Graeme Ashley-Fenn as head of its regulatory advisory practice in London. For other updates launch today's Movers & shakers slideshow.
Jamie Dimon has earned his shareholders' confidence and loyalty. Now, what else can he do? More video