Barclays CEO Venkat on turning around a FTSE 100 bank and leading through cancer

"Banks actually just do a few fundamental things," says C.S. Venkatakrishnan, the CEO of Barclays, who is universally known as Venkat. "We store your money, we lend your money, we move your money, and we help you invest your money. That's what we do. At the core foundation of it is trust."

It's a deliberately simple framing from someone who has spent his career in the complex end of finance – from quantitative programming at JP Morgan to chief risk officer and then chief executive of one of Britain's oldest institutions, Barclays Bank. Indeed, as Venkat likes to point out, "we've been here for 335 years. This bank is older than the Bank of England." 

But in some ways that is the problem for Barclays, which Venkat has been trying to fix since becoming CEO in 2021.

Speaking to Sir Richard Harpin on the Business Leader podcast, he shares his view that Barclays forgot its British foundations, as it scaled up to the highest echelons of global finance. "By becoming a big international consumer and investment bank," says Venkat, "we'd forgotten our home."

His strategy for fixing that, which has so far increased shareholder value by around £40bn, contains many lessons for businesses of all sizes.

In this interview, we cover:

• The inside story of Barclays’ restructuring in 2024
• His experience of working through cancer, and the unintended impression he fears this gave to his colleagues
• Tips on how to make M&A work
• His take on the 1973 Consumer Credit Act and why it’s holding back consumer lending

Venkat describes his birthplace of India as "the foundation of my cultural being". He grew up in Mysore in the south of the country, though his route to the top involved an overseas scholarship to an elite US university.

“In India you have to fight for your opportunities,” Venkat reflects, “which requires resilience. You have to work to find a way out."

Studying at Massachusetts Institute of Technology (MIT), he says, "catapulted me to be with the smartest people in the world, which teaches you humility quickly". It also opened his eyes to the idea that talent can come from anywhere, because MIT has such a broad, international intake of students. "Excellence has no boundaries", is one of the lessons that Venkat absorbed internally.

Venkat's doctoral thesis was on air traffic control, a subject where risk mitigation is paramount. The work inspired analytical thinking, says Venkat – a case study in how to crack complex problems. And what's critical is a consideration of "which parts you leave alone". Success can come from careful adjustments over time, and you don't tinker with everything.

Risk and crisis

Those lessons would soon be put to the test in the real world, as Venkat joined JP Morgan as a computer programmer, doing quantitative work focused on derivatives, interest rates and fixed income bonds. His aptitude for management saw him climb the corporate ladder, and he was running the bank's fixed income asset management business when the Financial Crisis struck in 2008.

"You learned what you didn't know," recalls Venkat, looking back to this time of crisis. "It brought humility to understand there are things that are unknowable, and you need a healthy respect for uncertainty and unpredictability. The systems that seem apparently strong can be fragile."

Venkat joined Barclays as chief risk officer in 2016, and the discipline of that role runs visibly through his thinking. His definition of a risk management failure is precise: "You will lose money. But you should never lose more money than you thought you could in a situation. And you shouldn't lose money in a way you had not anticipated. If either of those two things happens, it's a risk management failure."

When he was elevated to the CEO role in 2021, it was a shock he had not anticipated. "The first two or three days were a bit of a daze," recalls Venkat. In a whirlwind move, Venkat stepped up after his predecessor Jes Staley was forced out as CEO in November 2021. UK regulators ruled Staley had not accurately disclosed the nature of his relationship with convicted paedophile Jeffrey Epstein to the Barclays board.

Venkat has not directly commented on Staley’s conduct, but after more details of Epstein’s activities were released earlier this year, he said he was “deeply dismayed and shocked” at the “depravity and the corruption” revealed, while emphasising his thoughts were with the victims.

His sudden ascent to the role of CEO was certainly unexpected, but Venkat reflects that he had been trained for many years for the job. He had observed Jamie Dimon at JP Morgan and as CRO he had "seen it all". One key piece of advice he would pass on when stepping up to CEO is to build a good relationship with your board, which means forming human relationships with members as individuals. Then, of course, you have to set up a management team that will execute your strategy. He ended up changing around 20-40% of his leadership team.

But for all your preparation to lead, nothing can prepare you to take up the mantle. Venkat likes to quote Mike Tyson's famous line, "Everyone's got a plan until they get punched in the face."

Working through cancer

For Venkat, those punches arrived fast and hard. In late 2022, four months after dealing with a significant securities issuance error that cost the bank several hundred million dollars to resolve, Venkat discovered that he had cancer.

He had spent a weekend working with the Bank of England on a facility to support pension funds during the gilt crisis and then went for a run on the Monday morning. When he got home, he was wiping away the sweat on his head and he felt a lump on his neck.

"The first question I asked [the doctor], which my wife was not happy with me asking," recalls Venkat, "was, 'Can I work while I get this treatment? And he said, ' Not only can you; you should." For four to six months, Venkat ran Barclays remotely, via video call. His board was supportive and his management colleagues took up some of his work, "so I could focus on the things that only I could do".

But he's candid about one miscalculation: "One of the mistakes I made early on is when I said I was doing this, I underestimated the impact on my colleagues." Some of these colleagues, Venkat reflected, had wondered whether they would be expected to do the same should they fall ill, or whether his ability to work through it was a privilege of his position that wouldn't be available to them.

The bank has since been explicit. "We've made it very clear to our people that if they want to work, we support them through it and any illness, but it's not a requirement." It's a lesson that leaders must consider what their behaviour symbolises to the wider team, however laudable their personal motives.

The experience did change him, though perhaps not as much as he intended. "I said to myself that I have to pace myself better, look after my health more... I try to say that I'll do the things I want to do and I won't do the things I don't want to do."

Space for strategy

When Venkat set out his three-year strategy in 2024, the diagnosis was blunt. Barclays was the largest of the European investment banks. But, it was trading at roughly half its book value, implying that the market either didn't believe the bank would generate the profits it projected, or expected higher losses than management did.

But the deeper problem, he believes, was strategic drift. "We've been here for 335 years. This bank is older than the Bank of England. We started in 1690. This is our home. And by becoming a big international consumer and investment bank, we'd forgotten our home. We were insufficiently valuing our home market."

So, Venkat decided to "renew our vows to the UK". The strategy that followed did two things: recommit to the UK – including deploying an additional £30bn in risk-weighted assets into the domestic economy – and make the investment bank a smaller but more profitable part of the overall group.

Barclays was restructured to create a separate UK corporate bank alongside the ring-fenced retail bank, and a standalone private banking and wealth arm. "Touch wood," Venkat says, "it's working on all three fronts."

In perhaps another signal of Barclays' commitment to the UK as its natural home, this summer it bought the 999-year lease on its headquarters at One Churchill Place in Canary Wharf.

Challenging the banking landscape

While resetting his bank's own course from within, Venkat still worries about some of the external challenges all banks in the UK are facing. His most pointed remarks concern a piece of legislation most people have never heard of. "There is something in the UK called the Consumer Credit Act [1974], which has severely, in my opinion, and unreasonably restricted the ability of banks to lend to consumers," he says.

The practical consequence is a bank liability for consumer credit card purchases that he finds difficult to justify: "If you wanted to put in a heat pump in your house or a solar panel in your house and it didn't work as advertised, then the bank is on the hook if they lent you the money – making the banks risk-averse."

The government published plans to modernise the Consumer Credit Act in May. However, the issue of the banks' liability for purchases was not part of the terms discussed.

Venkat's message to the new chancellor is firm: "I would ask them to examine how we can increase the amount of lending into the UK economy, not just to companies but to individuals. More broadly, growth is the cure that lifts all boats."

On the related issue of motor finance, he is careful but not defensive. The Financial Conduct Authority is looking to enforce a £7.5bn industry-wide compensation scheme for around 12 million motorists who took out loans between 2007 and 2024. Barclays has set aside £325m to compensate customers for its role in the affair.

"It's not like the banks did everything perfectly. We did not. And for what we did wrong, we should be liable and we should pay." But, he adds, "I think both in terms of the amount of look back and the way that some of these calculations have been done, it's unreasonable."

Lenders like Crédit Agricole Auto Finance and the financing arms of Volkswagen and Mercedes-Benz are challenging the regulator in court. Barclays' own exposure is compounded by what Venkat sees as an injustice of timing. The bank exited the motor finance business entirely in 2019 – Venkat's own call as chief risk officer at the time – precisely because the consumer environment made it unviable.

"Even though we got out in 2019, we've still taken hundreds of millions of pounds of provisions for things between 2014 and 2019, and we were a small part of the market."

Venkat parts company with bankers looking to push back on government rules when it comes to ring-fencing - the post-2008 rules requiring large UK banks to separate domestic deposits from investment banking operations.

"I think there's nothing about ring-fencing that restricts the major UK banks from lending into the UK economy." It goes back to the core value of banking, which is trust.

"I remember queues outside Northern Rock," says Venkat, of the spectacular run on a British Bank, which saw people queue up to take their money out of the bank, which was exposed to the US subprime crisis. It was the first run on a bank in the UK since the 1840s. "What did it show us?," says Venkat, "that the most fundamental part of regulation is protection of depositors."

Venkat's advice for UK scale-ups

Venkat has four pieces of advice for founders of businesses turning over between £10m and £100m and trying to scale. Firstly, be ambitious. "The great thing about the UK is the world is your oyster," Venkat says. Secondly, work with your banks to build properly financed business plans. Thirdly, push back on the government when regulation is restricting your customers' ability to buy your products. And fourth, hire good people and manage yourself well.

And on leadership philosophy, he has some advice to share too. His watchword and operating principle as CEO is "comparative advantage", which means spend your time only on what you, specifically, do better than anyone else around you. Delegate the rest.

"Find good people and trust them and accept not everyone will do things exactly as you would and that's fine," advises Venkat. Many senior leaders don't get this, he points out. They delegate, but then criticise.

His other simple piece of advice is this: "If you put the company first and do a good job without thinking about what's in it for me, actually what's in it for you will be the best for you."

Listen to the full conversation with C.S. Venkatakrishnan on the Business Leader podcast.