According to Reuters, Barclays is working on cost-cutting proposals worth 1 billion pounds ($1.25 billion), which might include roughly 2,000 job cutbacks, primarily in the British bank's back office. Managers at the organization are now considering recommendations to increase profitability. On the condition of anonymity, the person claimed that if the plans were fully implemented, 1,500 to 2,000 jobs could be lost. The management team at Barclays is overseen by Chief Executive CS Venkatakrishnan, also known as Venkat within the bank.
He stated that the anticipated layoffs would mostly be at Barclays Execution Services, or 'BX,' and would be part of an overarching objective of cutting expenses by up to 1 billion pounds throughout the firm over a number of years. In recent years, Barclays has made steps to cut costs by reducing bonuses and job opportunities in its retail and investment banking operations. Reuters noted that the measures to downsize BX and the possible savings had not before been published.
BX was established in 2017 to integrate support services for the bank's two main business divisions, UK retail banking and international, with the goal of eliminating duplication and implementing post-crisis risk management regulations. Furthermore, the BX headcount discussions are still underway, and Barclays may decide to prioritize layoffs in other sectors. Staffing and costs at BX have increased dramatically in recent years. According to regulatory filings, its personnel increased to around 22,300 as of the end of 2022, up from 20,000 at the end of 2017, and now accounted for more than a quarter of Barclays staff. BX's annual staff costs have climbed from 1.8 billion pounds to 2 billion pounds. Currently, Venkat is under pressure to find methods to raise Barclays' dwindling book value ahead of a February investor presentation in which he will outline a new strategy.
The seasoned banker has been dealing with the aftermath of a trading misstep that cost the bank hundreds of millions of dollars since taking over as CEO. He will also face a protracted battle to keep morale high at Barclays' investment bank, where a talent exodus is hampering efforts to compete with European rivals such as Deutsche Bank, BNP Paribas, and UBS.
On October 23, Venkat stated that Barclays would undergo additional restructuring in preparation for its February 20 presentation, which is viewed as a critical moment for the bank to persuade shareholders that management has a plan to increase its valuation. The company has been working with Boston Consulting Group on a strategy assessment to determine which sections of the business should be increased in investment and which should be cut or sold.