Barclays Europe retail aims for 500 million pounds profit after revamp
By Steve Slater
LONDON (Reuters) - Barclays (BARC.L: Quote) retail operations in Italy, Spain, France and Portugal will return to profit in two years and could deliver 500 million pounds ($805 million) of annual earnings once a turnaround of the business takes hold.
Barclays has already shut 443 of its branches in mainland Europe this year and will cut about 1,500 jobs across the business by the end of the year, achieving the bulk of a revival plan set out in February.
Barclays Chief Executive Antony Jenkins wants the turnaround efforts to return the loss-making European retail business to profit in 2015.
"That will happen. I'm confident on that occurring," Curt Hess, head of the bank's Europe retail and business banking, which covers Italy, Spain, Portugal and France, said.
"I feel we could probably get to half a billion (pounds) of profitability in terms of my four markets," he told Reuters in an interview on Friday, adding that could be achieved earlier than 2020.
Hess said his division had not missed anything on the revival program, known as Transform, including a target to cut annual costs by more than a fifth to 650 million pounds by 2015.
The plans are part of a restructuring and root and branch review of Barclays' businesses after the financial crisis and the scandals that have followed it, such as benchmark interest rate rigging.
In the years before the crisis, Barclays had expanded aggressively in mainland Europe, but it hit problems as Spain, Portugal and Italy fell into recessions, driving up losses from bad loans. The bank's European retail business has lost almost 2 billion pounds over the last four years. Continued...