Following the example of Switzerland-based UBS bank, 30 major shareholders of Barclays have urged Antony Jenkins, Barclays’ CEO, to restructure its investment wing, by initiating job cuts.
Last month, UBS made a dramatic restructuring in the fixed-income side of its investment banking business, while creating 30,000 redundancies.
At a seminar with Barclays investment bank executives on Friday, Antony Jenkins of Barclays was faced with “dismay and exasperation” of investors at the unchanged strategy for the investment bank, according to a source familiar with the meeting.
Since August, when Antony Jenkins took charge as Barclays’ chief executive, he has been gathering investors’ views on strategy overhaul which is to take place in February. This exercise also involves dividing the bank into 75 operating units and assessing each one’s cost of capital and return on equity. According to sources, Antony Jenkins is in dilemma as to what to do with the investment banking unit.
Investors feel that the direction of regulation and political sentiment have strengthened the logic of separating retail and investment banking operations.
Meanwhile, in a new development, Qatar Holdings plans to sell Barclays shares valued at about £771 million ($1.24 billion) as the sovereign wealth fund disposes of its remaining warrants in Barclays.
Qatar Holdings will continue to remain the biggest shareholder in Barclays with its 6.7% stake staying unchanged. Barclays shares have risen 42% since the bank announced a plan in October 2008 to raise 7 billion pounds in capital from investors including the Abu Dhabi and Qatar sovereign wealth funds to avoid a government bailout.
This year, Barclays shares have surged 44%, closing at 254.20 pence on November 23 in the UK stock market. The stock is being offered by Qatar at a discount of as much as 4%.