James Staley, Barclays’s C.E.O., will step down after a Jeffrey Epstein inquiry.
British regulators investigated the ties between the bank executive and the disgraced financier.
James E. Staley, the chief executive of Barclays, will step down after an investigation into his relationship with the disgraced financier Jeffrey Epstein.Credit…Peter Nicholls/Reuters
Barclays said on Monday that its chief executive, James E. Staley, would step down immediately following the results of an inquiry by British financial regulators into Mr. Staley’s relationship with the disgraced financier Jeffrey Epstein.
The surprise exit of Mr. Staley, 64, roiled the leadership of Barclays, a three-century-old lender that is one of Britain’s biggest banks. And it makes him the latest prominent figure to face blowback from his association with Mr. Epstein, a convicted sex offender who killed himself in 2019 after facing new allegations of sex trafficking of underage girls.
The bank said it learned on Friday of the preliminary conclusions of a nearly two-year investigation by the regulators, the Financial Conduct Authority and the Prudential Regulation Authority, into the two men’s relationship, which dates back to Mr. Staley’s tenure as the head of private banking at JPMorgan Chase. Mr. Staley used Mr. Epstein to connect with potential clients.
Barclays said in a statement that Mr. Staley agreed to step down as chief executive and from his position on the board, and that he intended to contest the investigation’s findings. It added that the investigation did not make any findings that Mr. Staley “saw, or was aware of, any of Mr. Epstein’s alleged crimes” and that it was “disappointed” with the outcome.
The Prudential Regulation Authority and the Financial Conduct Authority declined to provide any details about what their inquiry had found, saying in a joint statement that they “do not comment on ongoing investigations or regulatory proceedings.”
Barclays said the investigation focused on how Mr. Staley had characterized his relationship with Mr. Epstein to the board, and the subsequent description of the relationship in Barclays’s response to the Financial Conduct Authority.
Mr. Staley previously said that he had been “transparent and open” with Barclays about his ties to Mr. Epstein.
Last month, the office of the attorney general of the Virgin Islands asked Barclays for additional information about Mr. Staley’s ties to Mr. Epstein, as part of its lawsuit against the Epstein estate.
He will be succeeded as chief executive by C.S. Venkatakrishnan, Barclays’s co-president and head of global markets. Like Mr. Staley, he is a former JPMorgan executive, who first rose to fame for warning about the “London Whale” scandal that resulted in more than $6 billion in trading losses at the American banking giant. His elevation to co-president last year signaled to London’s finance community that he was a potential future leader of Barclays.
Shares in Barclays were down less than 2 percent in London trading.
In February 2020, Barclays announced the regulators’ investigation, noting that Mr. Staley “developed a professional relationship with Mr. Epstein” earlier in his career. “Mr. Staley also confirmed to the board that he has had no contact whatsoever with Mr. Epstein at any time since taking up his role as Barclays Group C.E.O. in December 2015,” the company added. The board then recommended that Mr. Staley be reappointed as chief executive.
The board had previously stood by Mr. Staley in 2018 as New York authorities ordered the bank to pay $15 million in penalties after he tried to discover the identity of a whistle-blower who had questioned the hiring of a senior banker in 2016. The New York Department of Financial Services said it had found “shortcomings in governance, controls and corporate culture” at the bank.
In stepping down, Mr. Staley becomes the latest corporate leader to suffer consequences from being linked to Mr. Epstein. In January Leon D. Black announced his resignation as chairman and chief executive of Apollo Global Management after revelations that he had paid more than $150 million to Mr. Epstein.
Leslie H. Wexner stepped down as chief executive of L Brands, the parent company of Victoria’s Secret, after pressure over his ties to Mr. Epstein. And Bill Gates, the Microsoft co-founder, faced scrutiny after The New York Times reported in 2019 that he began a relationship with Mr. Epstein after Mr. Epstein had been convicted of sex crimes.
Mr. Staley, an American who is known as Jes, became chief executive at Barclays in 2015 after serving as a top executive at JPMorgan.
News of the investigation in 2020 prompted an activist hedge fund critical of Barclays to call for Mr. Staley’s dismissal. Sherborne Investors, which at the times described itself as the biggest single shareholder in Barclays, said in public letters that renominating Mr. Staley as a director was “extremely ill advised.”
American Airlines canceled more than 1,200 flights over the weekend, blaming bad weather and staffing shortages for the widespread disruption. The cancellations represented more than 12 percent of the airline’s scheduled flights for Saturday and Sunday, it said, and came just weeks after Southwest Airlines was forced to cancel nearly 2,000 flights.
Severe wind late last week hampered operations at Dallas-Fort Worth International Airport, American’s largest hub airport, cutting into runway capacity and forcing a round of cancellations, David Seymour, the airline’s chief operating officer, said in a note to staff on Saturday. That disruption, combined with bad weather elsewhere in its network, stranded American flight crews in the wrong places, hindering the airline as it went into a typically busy weekend.
“To make sure we are taking care of our customers and providing scheduling certainty for our crews, we have adjusted our operation for the last few days this month by proactively canceling some flights,” Mr. Seymour said. “We are taking this measure to minimize any inconvenience as much as possible. Most of the customers impacted by these changes are being rebooked the same day, and we apologize for having to make these changes.”
Airlines have struggled with brief, but significant disruptions since the spring as a travel resurgence collided with ambitious but tight flight schedules, bad weather and limited staffing after tens of thousands of workers took buyout or early retirement packages during the pandemic. Earlier this month, Southwest canceled hundreds of flights, also blaming bad weather that had similarly displaced its crews.
The travel recovery has come with “a lot of bumps in the operation,” Gary Kelly, Southwest’s chief executive, said on a call with investor analysts and reporters in October. “I would be the first to admit that things are messy,” he said.
American has faced similar challenges. But Mr. Seymour said in his note that the airline was confident that it was prepared for the busy holiday period, with nearly 1,800 flight attendants returning from pandemic leave on Monday and even more returning on Dec. 1. The airline is also hiring flight attendants, pilots and airplane maintenance technicians as it gets ready for an expected return to prepandemic levels of passenger travel next year.
F.O.M.C. meeting: Officials on the Federal Reserve’s Federal Open Market Committee are expected to announce that they will slow bond purchases, which they have been using to support the economy, and to give an up-to-date take on recent inflation and employment data. The Fed is not expected to raise interest rates until at least the middle of next year.
B.O.E. meeting: The Bank of England is expected to announce that it will raise interest rates in 2022. Bank officials have been debating whether to raise interest rates as higher inflation and supply chain bottlenecks are forecast to last longer than they expected.
Uber earnings: The ride-hailing company is set to publish its financial performance report for the three months that ended in September. A decline in ridership during the pandemic has been somewhat offset by a surge in Uber’s food-delivery business, but analysts expect its mobility business to see some recovery during the quarter.
Jobs report: The Labor Department is expected to release its monthly jobs report for October. Economists expect job growth to have accelerated from September’s weak pace as hospitalizations and deaths linked to the coronavirus fell in October.
Saudi Aramco, the world’s largest oil company, said Sunday that its profits for the third quarter nearly tripled compared with the period a year earlier, as demand for the fuel recovers from the pandemic and prices soar.
Aramco, Saudi Arabia’s national oil company, said that net income was $30.4 billion for the July-to-September period, up from $11.8 billion a year ago when demand for oil collapsed and prices tumbled.
The huge profits are largely a reflection of rapid increases in oil prices. Aramco’s statement did not give full financial details, but it is likely to have received about $70 a barrel on average in the quarter compared with $43.60 a barrel in the same period in 2020.
Saudi Arabia and other oil-producing countries cut output sharply in response to the fall in demand as the pandemic slowed driving, air travel and other activities. Now these countries are ramping up production but at a pace that is frustratingly slow in the view of some critics, including the Biden administration.
Aramco said that its crude oil output in the third quarter of 2021 averaged 9.5 million barrels a day, only a modest increase to the 9.2 million barrels a day in the same period in 2020.
In a statement, Amin H. Nasser, Aramco’s chief executive, said he was “optimistic that energy demand will remain healthy for the foreseeable future” despite headwinds like supply chain bottlenecks.
As world leaders gather in Glasgow this week for what is being described as a crucial United Nations climate summit, Aramco’s results are a reminder that the global economy is still hooked on oil. Many forecasters expect demand for oil next year to exceed 2019 prepandemic levels.
While Western oil companies like Royal Dutch Shell and BP are wary of new long-term investments in oil, a few companies, including Aramco and the Abu Dhabi National Oil Company, or ADNOC, are betting that there will be a market for their petroleum for many years to come.
Aramco said it increased capital expenditures by 19 percent in the quarter to $7.6 billion, in part to bolster the amount of oil it can produce to 13 million barrels a day from 12 million barrels a day.
The company, whose shares were listed on the local Tadawul exchange in 2019, will pay an $18.8 billion dividend for the quarter, mostly to the Saudi government.
President Biden’s ambitious goals to wean the United States from fossil fuels could be upended by aging transformers and dated electrical lines that have made it hard for homeowners, local governments and businesses to use solar panels, batteries, electric cars, heat pumps and other devices that can help reduce greenhouse gas emissions.
The New York Times’s Ivan Penn reports that much of the equipment on the electric grid was built decades ago and needs to be upgraded. It was designed for a world in which electricity flowed in one direction — from the grid to people. Now, homes and businesses are increasingly supplying energy to the grid from their rooftop solar panels.
These problems have become more urgent because the fastest way to cut greenhouse gas emissions is to move machinery, cars and heating equipment that run on oil and natural gas to electricity generated by solar, wind, nuclear and other zero-emission energy sources. Yet the grid is far from having enough capacity to power all the things that can help address the effects of climate change, energy experts said.