London - Barclays will stop offering wealth management services in about 130 countries by 2016 and cut jobs in the unit as part of an effort to rein in costs and boost the British banking group’s profit.
“This is part of our new strategy, focusing on reducing complexity and competing where we can win,” a Barclays spokesman said yesterday.
Barclays Wealth employs about 8 000 staff, and the spokesman said there was unlikely to be a significant change to that number although some jobs would go as the unit was restructured and technology upgraded.
Barclays announced plans in April to restructure its wealth business to work more closely with the retail and corporate banking divisions and rolled out the strategy this week after naming Peter Horrell as chief executive of its wealth and investment management unit on Monday.
Horrell had held the position on an interim basis since May, when Tom Kalaris was ousted.
Profitability at the wealth unit continues to lag rivals and the targets set by chief executive Antony Jenkins. The division posted a return on equity of just 2.5 percent in the first half.
The plan will see the unit focus on 70 markets, which it estimates covers 86 percent of the global wealth market, and leave countries where it lacks scale or which are unprofitable.
The bank will stop full-service wealth management for thousands of customers with between £100 000 (R1.6 million) and £500 000 to invest. They will be served by a “lighter touch” new segment called “private clients”.
Other banks are restructuring in wealth management and Credit Suisse said this week it would pull back from some countries.
Barclays Wealth, which manages assets of about £200 billion, aims to cut the number of its booking centres, which enable clients to trade and book assets in particular jurisdictions, to about a dozen from 17. - Reuters