Barclays Makes A Healthy Snack Of Lehman

Will Barclays lead the next generation of global financial brands? Barclays president Robert E. Diamond Jr. says so: "Our aim is clear: to be the premier global investment bank." The new Best Global Brands 2009 report from brandchannel's parent Interbrand calls the bank a "brand to watch," but the WSJ reports it has a few hurdles to clear before claiming ascendancy.

Relatively fresh-faced, Barclays has weathered the economic crisis with not just a strong balance sheet, but an increased reputation. Despite its failed attempt to save Lehman, the bank is viewed positively for absorbing many of Lehman employees. Interbrand's report observes:

The British banking icon is emerging out of the crisis stronger than many of its peers. It appears that the company made a good decision not to take government money in December and the sale of BFI enabled the firm to stay liquid and benefit from new opportunities. Barclays has done a good job integrating Lehman's U.S. operations. It is definitely a brand to watch.

Barclays has begun to hire aggressively, most recently with the announcement that Bob Foresman from Renaissance Capital will lead the bank's major initiative in Russia, where Barclays acquired Expobank last year and rebranded their 36 branches. Rumors are now swirling that Tom King, Citigroup's recently departed head of banking for Europe, the Middle East and Africa, is entertaining an offer in Barclay's mergers and acquisition unit, an acknowledged Barclays weak spot. Diamond has reportedly courted former Merrill Lynch president Gregory Fleming for an undisclosed position.

The financial services sector's rapid recovery challenges Barclays to compete for talent, as other banks offer stronger legacies and heftier packages. Some have even begun to poach Barclays' talent.

Barclays recently encountered their first taste of post-bailout negative press: Lehman's creditors have accused the bank of underpaying for Lehman's assets by $10 billion, in a suit filed Tuesday. And the Wall Street Journal notes other setbacks, with Barclays losing big deals like Kraft's bid for Cadbury and the Deutsche Telekom-Telecom SA merger.

And since, despite Diamond's ambitions, Barclays doesn't yet fully meet the definition of a "global brand," it isn't included in Interbrand's annual rankings. Still, the report sees Barclays and several up-and-coming peers as bright spots in the badly bruised financial services landscape:

With limited legacy but strong business fundamentals, players like Credit Suisse, Santander, and Barclays are seizing the moment amidst the reordering of [financial services] brands. They are moving upward in rank and finding a distinguished seat in the game as the cards fall into place.