By Margot Patrick
Barclays PLC on Thursday told staff to get ready for changes at
its investment bank as it becomes a smaller, more-focused entity to
adapt to tougher regulatory and economic conditions.
Barclays earlier Thursday said it would lay out plans on May 8
to improve returns at the unit in a presentation that will also
address the broader bank's structure and focus. A review of the
investment bank has been under way since last year and is expected
by analysts to result in Barclays pulling back in commodities and
some areas of fixed income.
In an internal memo to staff seen by The Wall Street Journal,
Chief Executive Antony Jenkins said the new plans will address the
business areas the bank should focus on, and how to simplify what
is now a sprawling organization operating in 50 countries across
retail banking, business lending, investment banking, credit cards
and wealth management.
"The future for Barclays will be as a strong, focused,
international bank. And the investment bank will continue to be a
part of that mix," Mr. Jenkins said.
"By early May I am confident that we will have...set a clear
course for the next stage of our journey to build a better Barclays
which can deliver sustainable returns and growth over the cycle,"
Mr. Jenkins said.
In a separate announcement Thursday, Barclays said current
investment banking co-heads Eric Bommensath and Tom King would turn
over some of their responsibilities to three of their deputies,
with Eric Felder becoming head of markets and Joe McGrath and
Richard Taylor to serve as co-heads of banking. Previously, Mr.
Bommensath had been in charge of markets and Mr. King had been head
of banking.
The move will strengthen the investment bank's management team
and position it for "the next stage of evolution," Barclays
said.
Mr. Jenkins is under pressure from shareholders to improve
returns after posting a sharp drop in 2013 underlying profit. He
said in February the bank would cut around 12,000 jobs, or 9% of
its 139,600 workforce, and bring down the size of its balance sheet
to meet new regulations.
The investment bank has been the main focus for investors, since
it accounts for around two-thirds of the bank's total assets but
produced 38% of revenue last year. Mr. Jenkins drew criticism for
raising bonuses in the division despite a year-on-year drop in
revenue and profit, an issue that is likely to be raised by
shareholders at the bank's annual meeting on April 24 in
London.
Barclays will post first-quarter results on May 6. Analysts say
those are likely to reflect a broader industry decline in revenue
from fixed-income trading.
Write to Margot Patrick at margot.patrick@wsj.com
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