The boss of Barclays hailed Britain’s ‘resilient’ economy as he outlined a three-year turnaround plan aimed at reviving the bank’s dismal share price performance.
The lender is targeting £2billion in cost savings and £10billion in dividends and stock buy-backs, as well as a restructuring of the group into five business units.
Barclays – which axed 5,000 jobs from its global workforce last year – did not give any detail on how many more would go as a result of its further belt-tightening.
The lender’s beleaguered investment banking arm will still grow – but shrink as a proportion of the business – while it shifts focus to more profitable consumer and corporate operations.
Boss CS Venkatakrishnan – known as Venkat – also said he aimed to utilise the group’s position as the world’s largest non US-based investment bank, operating across leading global financial centres.
Turnaround plan: Barclays, led by boss Venkat (pictured), is targeting £2bn in savings and a £10bn in dividends and buy-backs
Amid persistent speculation about the division’s future, Venkat insisted: ‘It is an important part of Barclays and will continue to be so.’
He also put Britain at the centre of the group’s plans with a £30billion boost to lending allocated to its UK arm – including the aim of reviving credit card and other consumer borrowing.
Those plans will be bolstered by the recent takeover of Tesco’s banking operations, though Venkat did not directly address the question of whether some of the 2,800 staff from the newly-acquired business will keep their jobs, saying it was ‘very early days yet’.
At the same time, Barclays will end its retail presence in the EU as it exits consumer banking in Germany and continues the previously announced plan to dispose of its mortgage book in Italy.
Venkat said: ‘The UK has shown itself to be resilient, we think it’s a great consumer economy. We are very, very bullish on the UK as a place to do business and from which to do business.
‘I am hopeful that it is not just the consumer economy in the UK, it’s the business economy.’
He acknowledged that it would ‘take some time’ to restore Britain’s ‘equity culture’ and revive the market for new listings.
Those comments came amid concerns over low valuations for UK-listed firms. ‘This is the start of a longer journey,’ Venkat added.
The shake-up came as Barclays reported a 6 per cent fall in annual profits to £6.6billion as it took a £927million hit from restructuring costs while global markets income and investment banking fees fell. Shares rose 8.6 per cent, but are down 20 per cent since Venkat took over in 2021.
RBC Capital Markets analyst Benjamin Toms gave a cautious reaction to the latest update.
‘The market is likely to want to see tangible progress before rewarding the bank with a higher valuation multiple,’ he said.
