The Bank That Lived a Little

Augar traces three decades in which Barclays, which began as a Quaker bank, tried to become one of the world's top investment banks, and the fight between executives who wanted that and those who preferred a smaller, mainly domestic bank. The cost was high. By 2004 Barclays was borrowing more than 30 times its equity, against an international average of about 22, and the story runs on through payment protection insurance mis-selling, Libor and the forced exits of more than one chief executive.

Augar is a former investment banker with a doctorate in history, the author of The Death of Gentlemanly Capitalism and a regular contributor to the Financial Times. He had wide access to the people involved. John Plender in the FT called the book both a thriller and a reminder that all human life is in business. Vicky Pryce in the Literary Review called it essential reading, though she found Augar's attempts to describe executives' inner feelings the weakest part, and noted that he leaves readers to judge the Libor emails for themselves.

It is the best single account of a British bank's pre- and post-crisis strategy, and it suits anyone weighing universal banking or bank governance.

1. Strategy fights can be more dangerous than markets. Barclays spent three decades torn between investment banking and retail, and the indecision cost it chief executives, capital and credibility.
2. Leverage hides in plain sight. Borrowing more than 30 times equity by 2004 left little room for error, yet it was widely seen as normal before 2008.
3. Product profits can be liabilities in waiting. PPI looked like a reliable earner until mis-selling turned years of profit into a huge compensation bill.
4. How you raise capital matters. The Qatar deals kept the government out but brought years of investigations, showing that avoiding a bailout can carry costs of its own.
5. Boards set the tone. Augar's sharpest criticism is aimed at a small circle of non-executive grandees who approved strategy and pay without challenging management.

The book follows Barclays chronologically, using it as a lens on the City's rise from the margins of the British economy to its center.

1. From Quaker bank to Big Bang. Augar sets out Barclays' traditions and its response to the 1986 deregulation of the City, including the investment banking push through BZW that he describes as a costly mistake.
2. The battle over strategy. Successive chief executives and boards fight over whether Barclays should be a global investment bank or a domestic lender, and Bob Diamond builds Barclays Capital into the group's engine.
3. Leverage and the crisis. Balance sheet growth outpaces peers, PPI sales prop up retail profits, Barclays buys Lehman's US operations in 2008 and turns to Qatar and other investors to avoid a state rescue.
4. Scandal. The Libor affair, emails suggesting pressure to keep the rate low during the crisis, and the furor over Diamond's pay and bonus end his short tenure as chief executive in 2012.
5. Aftermath. Antony Jenkins tries to shrink the investment bank and is removed in 2015, Jes Staley takes over, and Augar weighs the cost to shareholders and the wider legacy of a leveraged, winner-takes-all culture.

Based on unparalleled access to those involved, and told with compelling pace and drama, The Bank that Lived a Little describes three decades of boardroom intrigue at one of Britain's biggest financial institutions. In a tale of feuds, grandiose dreams and a struggle for supremacy between rival strategies and their adherents, Philip Augar gives a riveting account of Barclays' journey from an old Quaker bank to a full-throttle capitalist machine. The disagreement between those ambitious for Barclays to join the top table of global banks, and those preferring a smaller domestic role more in keeping with the bank's traditions, cost three chief executives their jobs and continues to divide opinion within Barclays, the City and beyond. This is an extraordinary corporate thriller, which among much else describes how Barclays came to buy Lehman Brothers for a bargain price in 2008, why it was so keen to avoid taking government funding during the financial crisis, and the price shareholders have paid for a decade of barely controlled ambition. But Augar also shows how Barclays' experiences are a paradigm for Britain's social and economic life over thirty years, which saw the City move from the edge of the economy to its very centre. These decades created unprecedented prosperity for a tiny number, and made the reputations of governments and individuals but then left many of them in tatters. The leveraged society, the winner-takes-all mentality and our present era of austerity can all be traced to the influence of banks such as Barclays. Augar's book tells this rollercoaster story from the perspective of many of its participants - and also of those affected by the grip they came to have on Britain.