Britain's second largest bank Barclays has started a consultation process to cut up to 2,000 investment banking jobs as part of its strategic revamp.
Group CEO Antony Jenkins will unveil the bank’s future strategy along with annual results in February. The overhaul is expected to include trimming of tax structuring unit and agricultural commodities trading operations, apart from increasing investment in retail banking business.
Jenkins, the bank’s former head of retail banking division, has reviewed the performance of bank’s every business line during the last five months.
Huw van Steenis, analyst at Morgan Stanley, told the Financial Times that the bank could free up around £9bn in capital by scaling back its investment banking business to expand the more profitable UK retail banking market.
“We do not expect radical reshaping of the investment bank, but anticipate details on the restructuring of legacy and subscale business areas,” he said.
The bank, which is considering adopting stringent regulation and capital rules in the wake of Libor scandal, will inform staff in Europe, Asia and the US about further redundancies in the next few weeks.
A Barclays spokesman told the Financial Times: “We have begun a process of consultation with UK-based employees. This exercise is being carried out so that we can start to effect some of the strategic changes as a consequence of the review of Barclays’ business.”
On the other side, the bank’s Swiss rival UBS has started process to reduce almost 100 investment banking jobs in the UK as part of its restructuring plan that also includes winding down large parts of fixed income trading business.
The bank’s investment banking division employs 23,000 people of which 9,000 are based in London.