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One of the biggest banks of the United Kingdom, Barclays is said to be working on a plan to slash around 100 top-notch employees from its investment banking operations, globally. Media sources have been reporting about the cuts even though the bank announced robust growth in the United Kingdom and had emphasised its continued commitment to the division. If the reports of employment cut are confirmed, it will be first to be executed by any major investment bank in the new decade.
The chief executive Jes Staley, who started working with Barclays in late 2015, has cut down investment bankâs expenditures and reduced activities but hasnât accomplished the sort of restructuring change which was seen at other European competitors like Union Bank of Switzerland.
In the year 2018 annual report, Barclays had stated that its headcount all across the globe was more than 83,000, while it had handed pink slips to over 3000 employees in the second quarter of the year. Though there are no confirmed reports of the latest cut in top jobs but, all those who will get impacted in all likelihood includes, Michael Brooks, a New York cash equities MD; James Neale, in FX sales London; Holden Sibley, head of electronic sales in New York City; Jeremy McElrea from cross-asset solution sales; Chris Toolan, co-head of United States equities trading; YD Dong, head of structuring in the equity and fund structured markets; Andy Packer, an MD in equity derivatives sales in London; Steven Li, head of United States futures and Over the Counter trading.
In October 2019, Jes Staley had said that Barclays had no objective of drawing back from equities trading and sales. But the alleged cuts are pointing towards numerous of the jobâs reductions from equities instead of fixed incomes. The headcount cut situation seems to have emanated from the fact that the bank was facing difficulties in attaining its return on equity target in nine months of the year 2019, while some are also pointing to the various recruitments in the investment bank segment by Tim Throsby does, who himself left the bank last year in April 2019.
The bank had reduced nearly 80,000 headcounts in the year 2018 since 2015; most of the job cuts came from Europe. There are various other lenders like Societe Generale SA and Deutsche Bank AG along with many others who had recently slashed jobs at their organisation.
European banks cut around 60,000 jobs in the year 2019
The European Central Bankâs constant pursual of negative tax rates, coupled with slowing economic growth, growing regulatory obligations and Brexit, led the banks across the UK, France, Germany, Spain and Switzerland, to go for over 60,000 jobs in the passing year. In the last quarter only, the job cuts were to the tune of 10,000 in desperation to recover from chronically weak profitability. The top ten banks in terms of market capitalisation have collectively witnessed pruning of employee base of over 1.1 million since the year 2008, much higher than their US counterparts.
Media sources have reported that HSBCâs acting chief Noel Quinn is planning for a cost-cutting strategy, which may culminate into the lender cutting thousands of jobs. Talking about the other lenders, the Job reductions at Deutsche Bank have been the most severe. After failing in merger with Commerzbank, the chief executive Christian Sewing declared retreat from investment banking business which led the lender to cut 18,000 jobs.
In France, Societe Generale removed 1,600 employees at its trading unit and securities which was about 8 per cent of the divisionâs total headcount. BNP Paribas too had told that extreme market conditions had already hit bankâs revenue and it closed its proprietary trading operation, Opera leading to various job cuts.
Barclays Plc
Barclays Plc (LON:BARC) is an international holding company of financial services. It is headquartered in the United Kingdom and delivers services and products throughout the segments of investment banking, wealth management, credit cards, corporate and personal. The businesses of the bank are distinguished in three operational segments, namely Barclays International, Barclays UK and Head Office.
BARC- Recent News
On 2nd January 2020, the company announced that it issued share capital with voting rights of 17,322.0 million ordinary shares as of 31st December 2019. The company also reported that no ordinary shares were held in Treasury stocks.
BARC â Share Price Performance
At the time of writing, on 17th January 2020, as at 09:41 AM GMT, the share price of BARC stood at GBX 176.19 per share on the London Stock Exchange, down by 0.35 per cent or GBX 0.61 per share, versus previous dayâs closing price of GBX 176.80 per share. The companyâs market capitalisation was at £30,625.40 million at the time of writing. The free float and share outstanding of the BARC were reported at 17.24 billion and 17.32 billion, respectively.
The companyâs share attained a 52-week high of GBX 192.99 on 16th December 2019, while it had touched a 52-week low of GBX 131.04 on 12th September 2019. The stock price of the company has increased by 9.76 per cent in last one year.
The beta of the BARC has been reported to be at 0.86; it indicates that the movement in the price of the stock of the company has been less volatile, as opposed to the movement of the comparative benchmark index in the previous one year.
