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Barclays axes 19,000 jobs, reins in Wall Street ambitions
Britain’s Barclays reined in its ambitions to be a Wall Street powerhouse on Thursday and signalled a return to its retail banking roots with a plan to hive off much of its investment bank and axe one in four jobs at the division. Chief executive Antony Jenkins, in his second strategic review since taking over as CEO in 2012, will cut 19,000 jobs in the next three years, 7,000 of them at the investment bank, and park 115 billion euros worth of risk-weighted assets in a new “bad bank”.
A slide in trading revenue due to investor uncertainty and tough post-crisis regulation combined with a string of senior staff departures and a row with shareholders over bonuses have forced Jenkins to take a knife to the investment bank, built up under his predecessor Bob Diamond and once the group’s profit engine.
Jenkins said the recent halt in the trading boom was not just due to a cyclical ebb but was partly permanent, as regulators have tightened the screws on large banks in the past 12 months, making some trading activities too costly to pursue.