Corporate raider Edward Bramson wants to break up and sell Barclays’ trading arm
Feared corporate raider Edward Bramson wants to break up and sell Barclays’ trading arm to boost profits, sources claim.
The activist investor who stunned markets earlier this year by buying a 5.2 per cent stake in the bank, making him its third-largest shareholder, is keen to ditch the bank’s bonds, commodities and currencies arm to free up £60billion of capital.
It is rumoured he hopes to sell the markets division, which employs almost 10,000 bankers mostly in London and New York, with US asset manager Citadel mentioned as a possible buyer.
If this cannot be achieved, Bramson wants to shut the division as it is so cost-hungry. The plan is at odds with the strategy of Barclays chief executive Jes Staley, who has staked his reputation on creating a profitable transatlantic investment bank.
It sets the scene for a bust-up and is likely to be watched with alarm by the Bank of England due to risks to financial stability.
There will also be Treasury concerns, as a break-up would cut the size of the UK’s last rival to Wall Street.
The plot is far larger than anything Bramson has taken on before – the stated aim of his fund is to invest in a struggling business, win a seat on its board and turn it around for big financial rewards.
He is reportedly interested in hiring more investment bankers as non-executive directors. Staley has offered to meet the 67-year-old but his approach has not been accepted.
It comes as Barclays prepares to unveil first-quarter results next week. The bank is likely to report a loss following a £1.4billion fine last month, for selling toxic mortgages during the financial crisis.
However, traders will be more interested in the performance of the investment arm which is thought to have had a good start to the year, boosted by global market turmoil.
Deutsche Chief Hammonds Goes
Struggling German lender Deutsche Bank has lost its chief operating officer in a fresh sign of turmoil.
Kim Hammonds stepped down following reports that bosses were weighing up her future.
It comes just days after Yorkshire-born chief executive John Cryan was sacked in a bitter power struggle. Hammonds was his ally, but it is rumoured other bosses are unhappy with the time it took her to cut costs and improve the IT network.
Her exit could be the first step in a wider purge by new chief executive Christian Sewing as he focuses on provincial lending.