Yahoo Finance Barclays Begins Implementing Job Cuts Across Investment Bank
(Bloomberg) -- Barclays Plc has begun cutting hundreds of jobs as the firm embarks on a £2 billion cost-cutting drive that’s part of Chief Executive Officer C.S. Venkatakrishnan’s yearslong plan to boost returns.
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Several hundred staffers in global markets, investment banking and research will be impacted by the cuts, according to people familiar with the matter. The cuts began on Wednesday, the people said, asking not to be identified discussing personnel information.
The latest dismissals confirm an earlier Bloomberg report that Barclays was preparing to cut several hundred jobs within its investment bank division, which includes trading, advisory, capital markets as well as the firm’s international corporate bank.
“We regularly review our talent pool to ensure that we can invest in talent and deliver for clients,” Barclays said in a statement.
Venkatakrishnan has been under pressure to improve the British bank’s returns, which have lagged rivals. Barclays has long faced questions from investors about the viability of those Wall Street operations because the investment bank consumes more capital than other, higher-returning divisions across the firm.
Read more: Barclays Readies Hundreds of Job Cuts in Investment Bank
The bank is adamant that it sees itself as Europe’s last-remaining global investment bank, though executives have acknowledged they will seek to grow other parts of the business in order to improve that balance. Venkatakrishnan has said the investment bank won’t be allocated any additional risk-weighted assets from the parent company in the coming years, even as it navigates higher capital requirements from global regulators.
Hiring Push
To be sure, the British bank is seeking to hire staffers across markets, especially for areas where it’s seeking to gain additional market share like equity derivatives, European rates and securitized products trading. The bank has said it hopes to increase the revenue it generates from those businesses by £500 million by 2026.
David Garner is joining the bank as global head of securitized products bond trading, while Isabelle Millat was recently named head of sustainable finance for the global markets division and Barclays Europe.
The lender has also been building out certain areas of its advisory business and has been hiring bankers focused on helping companies navigate the energy transition and those in the industrials and health care industries.
To that end, the company appointed Rafael Abati as co-head of its energy transition group for Europe, the Middle East and Africa region in April. That same month, Stephen Pick was also named as head of mergers and acquisitions for the EMEA region.
The bank has won a number of key mandates recently and is advising Harbour Energy Plc on its $11.2 billion purchase of Wintershall Dea AG’s upstream oil and gas assets. The company is also advising Equitrans Midstream Corp. on its $5.5 billion sale to the US natural gas producer EQT Corp.
Read more: Barclays Eyes Sovereign Wealth Funds in Investment Bank Push
The cuts come just days after Barclays said income tied to its investment bank division sank 7% in the first quarter compared to a year earlier.
Equities trading was a bright spot in the quarter, with such revenue soaring 25% compared to the same period a year earlier. But that was more than offset by a 21% drop in revenue from fixed-income trading, which is typically a much larger business at Barclays.
While investment banking revenue improved slightly from a year ago, it remains muted as Barclays and its rivals battle a slump in dealmaking and capital markets activity relative to the boom times of the pandemic.
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