Barclays plan to axe its casino bank and sack thousands of staff in a bid to slash £1.7bn costs by next year

By

Daily Mail Reporter

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Barclays is preparing to take an axe to its casino bank and sack thousands of staff.

The radical overhaul comes as it tries to appease furious investors over its decision to hand a 13 per cent pay rise to staff at the investment bank last year, despite a 37 per cent slump in profits.

Staff received an average bonus of £61,000, angering campaigners and politicians.

Widespread sackings: Barclays, up 1.9p at 235.65p, has set a target of slashing costs across the group by £1.7billion next year

Some shareholders have run out of patience with the poor performance of the investment bank, coupled with rising costs.

Barclays, up 1.9p at 235.65p, has set a target of slashing costs across the group by £1.7billion next year.

It has been mulling plans to restructure the investment bank since the departure of the investment bank’s controversial former boss Rich Ricci last April.

But it was forced to put the changes on hold after being ordered by the Bank of England to boost its capital cushion because it fell short of financial safety targets. 

These concerns were allayed last October when Barclays went cap in hand to shareholders, raising £5.8billion from an emergency rights issue.

Last night Barclays dismissed reports that it is looking for a replacement for the joint bosses of the investment bank, Tom King in the US and Eric Bommensath in Europe.

But thousands of jobs are expected to be cut as part of the restructuring, which will be announced before the summer.

Capital is expected to be allocated to more profitable areas of the business, such as mortgage lending in the UK.

The impending revamp has been welcomed by analysts.

Ian Gordon from Investec said:  ‘I wouldn’t be the least bit surprised if there were big changes in direction and personnel, with big job cuts.

‘The status quo cannot be allowed to prevail. Above all, the market finally needs clarity on what steps are being taken to take out costs.’

Barclays is bracing itself for a big vote against its pay and perks at its annual general meeting on April 24.

Sixty council pension funds in the Local Authority Pension Fund  Forum have also been advised  to vote against the re-election  of remuneration committee chairman Sir John Sunderland,  who sanctioned the big pay rise.

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Ren,

Portland,

54 minutes ago

The sad fact is that the people who are going to lose their jobs would have had seen little of this bonus.

Paul F,

Leeds, United Kingdom,

4 hours ago

Finally, the propaganda put out by certain individuals that you have to reward, using a bonus system which promotes reckless behavior is going to be shown up for what it really is – wealth creation by individuals for individuals not wealth creation for the shareholders who actually own the business! After another round of tens of thousand of redundancies accross all sectors of the banking industry will those remaining still claim double digit pay rises as necessary to retain and attract the talent? It is about time all the ‘elite’ in financial services and on the boards of the FTSE 350 smelt the coffee and tide of change – the majority are no longer naive enough to continue to believe the ‘BS’ about ‘TALENT’ until it is backed up by tangible evidence to support the claims made! As a Barclays shareholder, I will be voting, as I have for the last 5 years, against the RR and against the election of every director – until evidence of tangible change is seen not just words promising change!

desertrat,

Stockton on Tees, United Kingdom,

4 hours ago

I have closed my account with them, a pity I could not do something more meaningful.

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Barclays plan to axe its casino bank and sack thousands of staff in a bid to slash £1.7bn costs by next year