Barclays Close to Hat Trick of Deals
August 25 2016 - 12:29PM
Dow Jones News
By Max Colchester
LONDON-- Barclays PLC's balance-sheet diet is accelerating, with
a drumbeat of deals expected to close in the coming weeks.
The British bank is set to announce the completion of the sale
of its Italian retail business in the coming days, according a
person familiar with the matter. Barclays's Iberian credit cards
unit is also on track to be sold, and the bank is in advanced
discussions with two bidders for its Egyptian franchise, this
person added.
Investors are watching the global retreat carefully. Like other
European banks, Barclays is looking pare back its sprawling
business amid low interest rates and increased regulatory pressure.
The bank's Chief Executive Jes Staley pledged to unload
GBP35billion of unwanted assets by the end of 2017 to bolster its
capital levels. To soak up losses on the sales, the bank cut
dividend payouts in 2016 and 2017.
Barclays's return on equity, a measure of profitability, was
4.8% in the first half of the year. Once unwanted assets are
stripped out, the bank's management hope returns should tick-up
into double digits.
Following the Brexit vote, some analysts feared the bank's slim
down would slow, or deals would be renegotiated, as investors
fretted about muted European growth.
Several big disposals were signed before the EU referendum.
Barclays announced last December that it had agreed to sell Italian
retail business to CheBanca, part of the banking group Mediobanca
Banca di Credito Finanziario SpA. The deal will see Barclays book a
loss of about GBP200 million but some GBP500 million of risk
adjusted assets will be stripped off its balance sheet. The Italian
bank employs 400 people and is made up of 89 branches.
On Wednesday Barclays announced it netted GBP615 million selling
its risk analytics business to Bloomberg. Other deals that are in
the pipeline including selling the bank's Asian wealth business and
shedding more of its 50% stake in Barclays Africa. Barclays is also
in the process of disposing of its French retail unit.
Write to Max Colchester at max.colchester@wsj.com
(END) Dow Jones Newswires
August 25, 2016 12:14 ET (16:14 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
Barclays (LSE:BARC)
Historical Stock Chart
From Mar 2024 to Apr 2024
Barclays (LSE:BARC)
Historical Stock Chart
From Apr 2023 to Apr 2024