When Barclays president Bob Diamond moved from the U.S. to London about a dozen years ago, he had an underlying suspicion that he'd be coming back to the States. And, in a way, that's exactly what has happened. While Diamond, 57, continues to live and works primarily in England, one of his chief initiatives this decade has been to oversee a major corporate focus on the Americas. A native of Concord, Mass., Diamond joined Barclays after financial stints with Morgan Stanley and CS First Boston. In addition to his post as president of the parent company, he is CEO of the company's Investment Banking and Investment Management business, which includes Barclays Capital, Barclays Global Investors and Barclays Wealth.

Under Diamond's tutelage, Barclays—one of the U.K.'s largest consumer banks—has vastly increased it sports sponsorship portfolio, including: purchasing title to soccer's English Premier League in 2004; acquiring title in 2005 to the PGA Tour's The Barclays golf event in the New York area, which is the kickoff for the FedEx Cup playoffs; buying the naming rights to the 18,000-seat Barclays Center in Brooklyn, N.Y., (where the NBA's New Jersey Nets plan to relocate) for a reported $400 million, one of the most expensive naming rights deals ever. Diamond sat down with Brandweek's managing editor Chuck Stogel during The Barclays golf event in New Jersey to have a chat.



Brandweek: Bring us up to date on when you decided to bring Barclays to the Americas and build your brand here, and how has it been going?
Bob Diamond: It was literally between five and 10 years ago that Barclays truly emerged as more than just a great U.K. retail and commercial banking institution. So while it's always had a global brand, of sorts, it was very much around its 'U.K.-ness.'

Expansion here] began about 10 years ago when we bought an asset management firm, which at the time was Wells Fargo Nikko, an indexing firm about a third the size of [Barclays Global Investors] today, and we also formed Barclays Capital just 10 years ago. In both those instances, we knew that to be successful those institutions would have to grow a significant presence in the U.S. We also knew we had to go about it in a very methodical, disciplined way because so many non-American banks and financial institutions have failed trying to grow in the U.S.

People recognized Barclays, and their reactions would be 'prestige, tradition, longevity,' but to be honest, sometimes [we] also got confused with Gerring [Wealth Management], and that's not the right one to get confused with. So, it was never negative, but people didn't quite understand who Barclays was. So we decided to invest in the Americas, and the Board asked me to do it, since most of the businesses here were reporting to me. And it's really only in the last five, six years.

BW: Why is it you decided not to enter the realm of branch-banking here?
BD: The simple answer is that the U.S., since the demise of the interstate banking rules and regulations, is now a mature, consolidating market. And, it's not in the early stages of consolidation; it's in the later stages. The last thing we want to do is get caught in a big, mature, consolidating market with a starter set, where you are the little guy and you can only advance by acquisition. There are a number of foreign banks that are beginning to build [branches] in the U.S., and we would not agree with that strategy.

Our sense is that building retail and commercial banking activities in South Africa, Russia, India, Pakistan, Indonesia—the places we are focused on—makes more sense than the [potential] here. For us, the U.S. is going to be about investment banking and investment management, not about retail and commercial banking. We're quite comfortable with that decision.



BW: Why did you decide to invest in such sponsorships in the U.S. as the PGA Tour and the Barclays Center in Brooklyn?
BD: The first thing we did here was the golf. And it was quite instinctive. We had good success with the Barclays Scottish Open (ed. note: the firm also sponsors the Barclays Singapore Open) and we followed that with a sponsorship of [European tour pro] Darren Clarke. Around the time that we invested in The Barclays [in New York], I was wrestling with the question: 'How do we get that broader brand of Barclays established in the Americas, very specifically in the U.S.?' When Buick decided to step away from one of their [golf] tournaments, which was at the Westchester (N.Y.) Country Club, we had an opportunity. We were able to move and [acquire that title].

The next thing that came up, and I owe a big debt of gratitude to [PGA Tour] commissioner Tim Finchem, because when he was creating the FedEx Cup, he came to me and offered us the opportunity to switch dates [from June to August] and become one of the FedEx Cup playoff events. It was a tough decision, because we loved our June dates, but I was sold on the whole idea of being a part of the FedEx Cup and the playoffs.

BW: How did you hook up with a golf star as big as Phil Mickelson, and become one of his sponsors?
BD: This is a true story. About a year and a half ago, my phone rang. It was my cell phone and I answered it, and it was Phil Mickelson calling. He said, 'I've played with you twice [in your pro-ams] and, you and I should talk. We've just switched from Bearing Point to KPMG on my hat, and I want one more sponsor. I'd like to do a longer-term deal. I think a financial institution is right. I think Barclays is a great institution.' Well, you don't hang up the phone on Phil Mickelson. So, I said, 'OK, talk to me.' And when I thought about whether I was really serious about branding Barclays in the U.S., [the answer was] there would be no better spokesman than Phil Mickelson-by the way he interacts with clients, by his enthusiasm, his intellectual approach, his game. It's so good for us with our clients to have an ambassador around the world like Phil, who's so American, and is such a part of our U.S. branding.



BW: Do corporate relationships with athletes lead to increased sales and business?
BD: The relationships are subtle. I don't think I've ever had a direct relationship between a piece of branding work and a piece of business. It's very hard to measure. I played 18 holes of golf the other day with Phil and two of my most important clients, and I don't expect because they played with Phil Mickelson, they'll do business with me. And, as president of one of the world's biggest banks, I had four and a half hours to spend with two very important clients. We weren't talking about deals, but we did get to know each other better and spend a great day together. Those things add up in terms of the depth of the relationship, the depth of trust and, in critical times or when other transactions do come up, we're better able to discuss them.

BW: Naming rights have become very popular across the entertainment venue landscape. What was the Barclays strategy in signing on with the new arena in Brooklyn, and how will you leverage the cost?
BD: We would not have done it if we thought it was expensive. We think it was an outstanding deal both for [real estate developer and Nets owner] Bruce Ratner and his businesses, and for Barclays. The revival of Brooklyn is so important for the greater New York area. It's the hub of transportation, just below the Brooklyn Center. It's the engagement with professional basketball and the 'New York' Nets, who also travel to London to play games. So, again, it's on many, many levels that we found an opportunity to invest in our brand in a major center of operations, the greater New York area.

BW: In general, these have been tough economic times for a lot of people and businesses. How has Barclays fared, particularly in the U.S.?
BD: I've been in this business 25 years, and the last year, without question, has been the most difficult environment for managing risk and managing foreign relationships that I've ever faced. On a relative basis, we're feeling good about our performance. We finished 2007 with a record performance in our businesses and in the Barclays Group. In 2008, in the first half, notwithstanding a difficult environment, we have £2.75 billion of profit, down just over 30% from last year; so it's down, and it's painful. Being a big global bank that has continued to be strongly profitable clearly sticks out in this environment. Most importantly, that gives us an opportunity to invest in our businesses, and right at the top of the list is here in the U.S. where so many of our competitors are distracted by the issues we face. [Still,] we expect through 2008 and through 2009, it will continue to be quite challenging.