LONDON/NEW YORK: Barclays is planning to withdraw from large parts of the metals, agricultural and energy markets as part of a restructuring of its investment bank, a source said.
Barclays is one of the top five banks in the global commodities business, and it is expected to announce its reduced activities to staff today. It is expected to involve sizeable cuts to staff, although the source did not specify how many people were likely to go. The Financial Times, which first reported the cutback, said there would be heavy cuts to the bank’s 160 commodities staff.
Barclays declined to comment.
Barclays follows other banks such as JPMorgan Chase and Morgan Stanley in a retreat from commodities as tougher rules make it less profitable, requiring them to hold far more capital than in the past against trading operations.
Barclays CEO Antony Jenkins plans to release full details of a review of the investment banking business on May 8, which could results in losses of thousands of jobs as he strives to cut costs and improve profitability in the business. The news on commodities will come before then and just two days before Barclays holds its annual shareholder meeting.
The bank, Britain’s third biggest, has been criticised at past annual meetings for some of its commodities activities, and investors are keen to see some signs of change from Jenkins. Reuters