Barclays Plc has this week cut several hundred jobs in its investment bank as part of its plan to shrink the business by 7,000 staff over the next three years to save costs, people familiar with the matter said.
The cuts will mostly be in the fixed income, currencies and commodities (FICC) trading and markets businesses, rather than in advisory and equities. FICC is the area that Barclays and several other banks such as UBS AG are scaling back due to falling revenues and tougher regulations.
The precise number of job losses was not known, but there will be cuts in Asia, Europe and the United States, the sources said. The latest cuts add to more than 400 already made by the British bank in its investment bank this year.
Barclays CEO Antony Jenkins last month reined in the bank’s ambitions to be a Wall Street powerhouse and said he would cut about one in four jobs in the division, as part of a plan to cut 19,000 jobs across the bank.
“As stated on May 8, at the time of our strategy update, Barclays plans to reduce the headcount of its investment bank by approximately 7,000 over the course of three years,” a spokesman for Barclays said.
“These reductions are in line with our commitment to a higher-returning investment bank with an origination-led banking strategy and a markets business focused on standardised, liquid products.”
Jenkins is attempting to cut costs and improve profitability at the bank. Trading revenues in FICC, especially interest rate trading, have slumped in the past year amid a low interest rate environment and banks have to hold more capital against the business, driving down returns.
Shareholders were also angered when Barclays raised bonuses for investment bank staff last year, despite a fall in profits.