Barclays isn’t giving up on its Wall Street dreams just yet. The British bank on Thursday scored a big victory over an activist investor who has been waging a campaign to shrink its investment banking division. It was a crucial win for Barclays CEO Jes Staley, a Wall Street veteran who believes the unit is central to the bank’s future success. Edward Bramson, head of Sherborne Investors, disagrees but has lost the argument for now. His bid for a seat on the company’s board was rejected by more than 87% of shareholders who voted at their annual meeting. Staley’s commitment to investment banking runs counter to the approach taken by many of his European peers, who have been scaling back in the face of poor returns. Now he’s positioned to stay the course. “While we’ve got more still to do, our turnaround is complete, and our strategy is now delivering,” Staley said at the shareholder meeting. Activist fight The battle over strategy pitted Bramson, Barclays\n \n (BCS)’ third biggest shareholder based in New York, against Staley, the American who has run the bank since late 2015. Before joining Barclays\n \n (BCS) in London, Staley worked for more than 30 years at JPMorgan\n \n (JPM), where he served as head of its investment banking division. It’s that unit at Barclays — charged with underwriting debt and securities, brokering trades and facilitating mergers and acquisitions — that’s been the source of significant tension. Bramson says it eats up too many resources and doesn’t provide sufficient returns. Poor first quarter earnings bolstered that claim, with income from the corporate and investment bank falling 11%. “We believe that the board should take the opportunity to reconsider its strategy now and to strengthen Barclays’ financial position, while market conditions are still relatively favorable,” Sherborne Investors wrote last month in a letter to other shareholders. The bank said that it had considered all options and Bramson’s plan would only undermine recent progress. Staley told analysts last week that the bank will look to cut costs in investment banking if revenues stay weak. However, he doesn’t think that will become “a new normal.” David Cumming, the chief investment officer for equities at Aviva Investors, told BBC radio this week that his firm had some “sympathy” for Bramson’s concerns, but did not think he should be on the board. “He’s been pretty successful in terms of critiquing [selectively] aspects of Barclays’ performance, but hasn’t really offered a credible alternative strategy,” Cumming said. Sherborne Investors did not respond to requests for comment on the outcome of Thursday’s vote. Industry crisis Still, Staley’s job is only marginally easier in the wake of Bramson’s defeat. With shares down about 20% in the past year, the CEO faces the difficult task of proving his strategy is the right one. He is up against a difficult environment for investment banks globally, though the pain is particularly acute in Europe. Banks there have slimmed down since the financial crisis, giving them less muscle to compete with American rivals. Sluggish economic growth also makes fees harder to come by. Staley maintains that Barclays is right to pursue a diversified approach and keep a hand in consumer, commercial and investment banking. “Our diversified model gives us balance,” he said Thursday. “And that balance can produce consistent and attractive returns through an economic cycle.” In recent years, other European banks have taken a different approach. Credit Suisse\n \n (CSGKF), for example, completed a three-year restructuring effort last year to focus on its wealth management division, which provides a more reliable stream of income. Solid results from wealth management helped the Swiss bank deliver an 8% profit increase in the first quarter of 2019, cushioning the blow of a 36% decline in revenue from its investment banking and capital markets arm. Barclays’ determination to stick it out on Wall Street has allowed it to move up the rankings of global investment banks. Based on revenue from the first quarter, Barclays occupies sixth place, ahead of Credit Suisse and Deutsche Bank\n \n (DB), according to Dealogic. US banks, including JPMorgan, Goldman Sachs\n \n (GS) and Morgan Stanley\n \n (MS) still dominate. And they’re scooping up an ever larger share of investment banking business. For Staley, that trend will be hard to buck — even though he’s just won a big vote of confidence.