31-July-14
Barclays (Barclays) Anthony Jenkins's vision has begun to take shape. While the picture is still blurred restructuring costs, hanging more pounds stretch resistance and heritage litigation, analysts say, the early signs are positive.
By reducing the once dominant, but now struggling investment banks and cut costs across the group, two months later, the CEO of Barclays announced a complete overhaul of its business model; he began sounding confident that he has.
Since taking over Bob Diamond in 2012, Mr. Jenkins pinned his reputation on the promise to clean up the banks, which at the time was to admit it to manipulate LIBOR benchmark reeling from the destructive culture.
"This is obviously a very different organization today than two years ago I inherited: capital more powerful, more disciplined cost around us," Jenkins said. "People look forward to the delivery and as to pass through the stock will re-rate."
Despite the reported 12% revenue decline, and fell 7 percent in pre-tax profit in the first half of each year, an analyst at Barclays widely applauded better than expected, and its shares rose 4 percent, has hit a new 18 month low earlier this month.
"The initial symptoms are helpful, but there is still a long way to go," banking analyst at JP Morgan Cazenove Raul Sinha said. "Although previous plans, we believe that this time they have the right strategy."
Barclays has moved about the $ 400 billion pounds of assets - including its retail operations and derivatives, securities and loans, mostly from the European continent a great combination of its investment bank - a non-core business unit unveiled in May as part of the overhaul.
In the first six months of this non-core divide by reducing the £ 85 billion, £ 2 billion to free up funds to strengthen its balance sheet. The key indicators of financial strength - - which helps its common shares from a capital rose 9.6 to 9.9 percent, close to its 2016 target of at least 11%.
Meanwhile, the bank has promised to lay off 7,000 people in its investment bank in 2016 and 1.4 million this year to get rid of the whole group. In June this year, a net decrease in their number of employees 5,000 people, including 1,700 jobs and increase its branch network digitization and automation lost in retail banking.
Thanks to £ 370 m, in order to reduce operating costs for the core business, to 7.9 billion pounds, in order to reduce the investment bank from imminent over 40%. Its goal is to reduce annual costs by 13% to 16.3 billion pounds in 2016.
However, cost-cutting failed to offset a sharp decline in revenues and profits in investment banking, down 18% and 46%, respectively, of the effect.
|