FTSE 100 Struggling for Direction
The FTSE 100 is struggling to find direction at the start of this week, with oil prices climbing thanks to strong demand, but trouble at Barclays weighing on the index, and the pound slowly gaining some strength against the dollar.
Barclays is facing issues with the Bank of England, as Chief Executive Jes Staley has been reprimanded for attempting to learn the identiy of a whistleblower. In June 2016, the board received an anonymous letter, and a second letter was sent to a senior executive, raising concerns about a senior employee that the bank had recruited earlier that year.
The FCA is now investigating Mr Staley, as part of a joint probe with the PRA, because of concerns over Barclays’ systems and controls relating to whistleblowing. The probe may end with Barclays facing a fine, and being ordered to make changes to their internal processes and culture with relation to whistleblowing. Staley himself could face a fine and public censure, and in the worst case scenario he may be banned from working in the City.
The FCA and PRA’s probes are just one of several issues that the bank is facing. Barclays was one of several lenders hit with misconduct fines recently, including the Libor scandal, and fines relating to the mis-sellling of mortgage backed securities.
The latest revalations come at an inconvenient time, as the bank had been on the verge of a turnaround, reporting healthy pre-tax profits even after paying out to settle litigation following the mis-selling scandal.