Backing Bob backfires badly

Heaven knows, we’ve all been there before, but imagine Ian Gordon’s reaction at breakfast time yesterday morning as he digested the news that Bob Diamond had resigned.

Not 24 hours earlier, Investec analyst Gordon had published a research note entitled: Back Bob!

“We urge investors to back Bob, and take full advantage of Barclays’ recent share price underperformance. Bob is going nowhere,” Gordon opined.

Yesterday’s note took on a different complexion following news of Diamond’s departure from the bank, with Gordon blaming Mob Rule! (sic) for the state of affairs.

“We are disappointed by Bob’s resignation this morning. That said, it is undeniable that the unrelenting political/media campaign had centred on Bob personally, and this was leading to a persistent misrepresentation of Barclays’ position in relation to the multi-bank Libor investigations, and a clear distraction from the execution of Barclays’ strategic repositioning,” Gordon thundered in yesterday’s note.

“Of course I feel a bit silly. It was the wrong decision but now Barclays needs to move on and make Libor a multi-bank problem.

“The situation is not pretty and the biggest risk now is inertia,” Gordon said yesterday.

Investec has still stuck to its advice to clients that Barclays’ shares are undervalued.