Breakingviews

Barclays’ trading woes offset pay restraint

March 3, 2015

The UK bank has cut investment bank bonuses by a quarter, atoning for a PR gaffe last year when pay rose despite a drop in profit. But 2014 results show returns in the unit are also lower. To maintain its turnaround, Barclays may have to shrink the misfiring division further

FX fines are wake-up call on self-policing

November 12, 2014

The $3.4 bln settlement for five banks works out on average at 20 pct higher than Libor – because the firms failed to mend their ways. Regulators are seeking yet tougher internal controls. Banks have a last chance to show they can treat clients fairly.

Bankers get painful and needed conflicts reminder

October 13, 2014

A $76 mln penalty against RBC for working both sides of a deal is the latest blow to skewed loyalties. Even with recent slaps at Goldman and Barclays, it isn’t clear the message is reaching Wall Street. Delaware courts seem up to the task of delivering it as loudly as it takes.

UK banks have much to fear from latest probe

July 18, 2014

Britain’s top antitrust watchdog has warned lenders to expect a full-blown competition investigation. Forced divestments would be a surprising outcome. But given the persistence of concern in spite of past probes, investors should brace for radical, profit-sapping remedies.

Barclays’ hit reflects investment bank fears

June 27, 2014

Shares in the UK bank tanked 9 pct after accusations of fraud in its “dark pool.” That implies a surprisingly big $6 bln hit. Fine inflation is rampant, and Barclays could suffer reputational damage. It’s a reminder: small investment banking businesses can carry outsized risks.

Barclays shows why it needs to do a UBS

May 6, 2014

The UK bank saw Q1 fixed-income revenue fall even more than forecast. Its Swiss peer didn’t fare much better, but UBS is already well into a wealth management-focused turnaround. While Barclays has fewer options, its strategic revamp on May 8 needs to be similarly radical.

A credible strategy for Barclays’ investment bank

March 18, 2014

The lender’s investment banking unit makes inadequate returns and pays too much. Both problems can be fixed by shedding weaker business units, leaving a franchise that attracts staff loyalty through good times and bad. David Walker’s successor as chairman has a key role to play.

Rudloff’s retirement is bad timing for Barclays

February 26, 2014

The UK lender’s chairman of investment banking is retiring after a distinguished 50-year career. Hans-Joerg Rudloff transformed Credit Suisse and Barclays into European contenders on Wall Street. As Barclays forges a new path, it could use his institutional memory and vision.

Lloyds’ shares look a better bet than Barclays’

September 16, 2013

The two UK banks are the focus of forthcoming share offerings. Barclays is selling 5.8 bln stg of new stock in a rights issue; the government is set to sell down its stake in Lloyds. Barclays is risky but cheap; Lloyds is more steady but pricier. Still, Lloyds looks better value.

Barclays’ rights issue is worth supporting – just

July 30, 2013

The UK bank’s shares dipped on news of a 5.8 bln stg rights issue. Investors can gripe that the cash call delays the advent of reasonable returns on equity, but it will bring fatter dividends closer. Supporters of Barclays’ turnaround strategy shouldn’t jump ship now.