Barclays puts profit ahead of customers: review

UK lender Barclays Plc had grown too quickly, paid bankers too much, and failed to cultivate a cohesive culture in recent years, according to a massive independent review published by the bank today.

The 236-page report was commissioned by the bank's top management over the Libor-fixing scandal last summer. The bank's then chief executive, Robert Diamond, resigned shortly after. Investment banking attorney Anthony Salz compiled the report. The report faults the British bank for ''a drift in standards'' and a ''drive to win'' that alienated customers, inflated pay packages beyond justifiable levels, and led to a dangerous level of risk.

Despite a number of attempts to establish group-wide values, the culture favoured transactions over relationships, the short term over sustainability, and financial over other business purposes, according to Salz.

A few were led to believe due to their pay that they were somehow not subject to the ordinary rules.

The review also noted that surviving the crisis, in some ways, added to the bank's troubled culture. The report points out that the acquisition opportunity for the US branch of Lehman Brothers during the financial meltdown of 2008, while attractive, left the bank with a major integration challenge.

In a statement, Barclays chairman David Walker said, the report  ''makes for uncomfortable reading in parts.''

According to Salz, the lender put profit ahead of customers and let lending standards slip from the early 2000s.

Salz said in an interview yesterday that through the 2000s there was a very short-term focus on profit, which led to a problem with culture and values. It appeared to emphasise financial performance rather than looking after customers, he added.

The bank, he said, had an unsatisfactory relationship with Britain's financial regulator.

He said they were seen to become, rather aggressive and a bit too clever by half and that led to less than ideal relationships, including with the UK regulator.