Barclays takes pounds 688m hit from BZW sell-off

Barclays yesterday revealed it would suffer a pounds 688m hit following last year's decision to sell parts of BZW, its investment banking arm.

Following City pressure to spell out the financial implications of the deal, the bank said its 1997 figures, due for release on 17 February, would include a pounds 340m restructuring charge and a pounds 129m goodwill charge. To the City's surprise, Barclays also revealed the businesses made an operating loss of pounds 219m last year. This was primarily due to "uncertainty surrounding their future and difficult market conditions", the bank said yesterday.

Martin Taylor, Barclays' chief executive, said: "We made a strategic decision to redefine our investment banking business in the autumn, because continuing to invest in parts of the business no longer made commercial sense for us."

Last November, the bank announced it was selling its UK and European equities and corporate advisory businesses to Credit Suisse First Boston (CSFB), the Swiss-American investment bank, for pounds 100m, pounds 50m less than book value. Later that month, it also announced it was closing its Japanese equities business, after failing to find a buyer, and, in December, Barclays sold its Australasian investment banking activities to ABN Amro, the Dutch bank for pounds 70m.

This year's announcement that CSFB was to buy some of Barclays' Asian equities businesses marked the end of the sale process. The bank's remaining Asian equities businesses are to be closed, with the possible exception of the Philippines, where Barclays still hopes to negotiate a sale.

Kathryn Newton, banking analyst at UBS, said: "The charges going through the profit and loss account [the pounds 340m restructuring charge and the pounds 129m goodwill charge] were slightly more than expected, but did not come as an enormous surprise. But the terrible trading loss [the operating loss of pounds 219m] was a big surprise."

The City was pleased Mr Taylor had moved to end uncertainty over the cost of the BZW sale, and Barclays' shares closed up 41p at 1886p.

National Westminster Bank yesterday moved to kick-start its troubled UK corporate advisory business by granting the unit more autonomy. NatWest Group is to embark on a "partnership arrangement" with NatWest Markets Corporate Advisory (NWMCA). NWMCA, which incorporates Hambro Magan, the corporate advisory business bought by NatWest in 1996, is to be renamed and will have its own management board. NWMCA employees will also benefit from a separate profit pool.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

SThree: Talent Acquisition Consultant

£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...

Day In a Page

John Palmer: 'Goldfinger' of British crime was murdered, say police

Murder of the Brink’s-MAT mastermind

'Goldfinger' of British crime's life ended in a blaze of bullets, say police
Forget little green men - aliens will look like humans, says Cambridge University evolution expert

Forget little green men

Leading evolutionary biologist says aliens will look like humans
The Real Stories of Migrant Britain: An Algerian scientist adjusts to life working in a kebab shop

The Real Stories of Migrant Britain

An Algerian scientist struggles to adjust to her new life working in a Scottish kebab shop
Bodyworlds museum: Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy

Dying dream of Doctor Death

Dr Gunther von Hagens has battled legal threats, Parkinson's disease, and the threat of bankruptcy
UK heatwave: Temperature reaches 39.8 degrees on Central Line - the sweatiest place in London

39.8 degrees recorded on Tube

There's hot (London) and too damn hot (the Underground). Simon Usborne braved the Central line to discover what its passengers suffer
Kitchens go hi-tech: From robot chefs to recipe-shopping apps, computerised cooking is coming

Computerised cooking is coming

From apps that automatically make shopping lists from your recipe books to smart ovens and robot chefs, Kevin Maney rounds up innovations to make your mouth water
Jessie Cave interview: The Harry Potter star has published a feminist collection of cartoons

Jessie Cave's feminist cartoons

The Harry Potter star tells Alice Jones how a one-night stand changed her life
Football Beyond Borders: Even the most distruptive pupils score at homework club

Education: Football Beyond Borders

Add football to an after-school homework club, and even the naughtiest boys can score
10 best barbecue books

Fire up the barbie: 10 best barbecue books

We've got Bibles to get you grilling and smoking like a true south American pro
Wimbledon 2015: Nick Bollettieri - Junk balls and chop and slice are only way 5ft 1in Kurumi Nara can live with Petra Kvitova’s power

Nick Bollettieri's Wimbledon Files

Junk balls and chop and slice are only way 5ft 1in Kurumi Nara can live with Petra Kvitova’s power
Ron Dennis exclusive: ‘This is one of the best McLaren teams ever – we are going to do it’

‘This is one of the best McLaren teams ever – we are going to do it’

Ron Dennis shrugs off a poor start to the season in an exclusive interview, and says the glory days will come back
Seifeddine Rezgui: What motivated a shy student to kill 38 holidaymakers in Tunisia?

Making of a killer

What motivated a shy student to kill 38 holidaymakers in Tunisia?
UK Heatwave: Temperatures on the tube are going to exceed the legal limit for transporting cattle

Just when you thought your commute couldn't get any worse...

Heatwave will see temperatures on the Tube exceed legal limit for transporting cattle
Exclusive - The Real Stories of Migrant Britain: Swapping Bucharest for London

The Real Stories of Migrant Britain

Meet the man who swapped Romania for the UK in a bid to provide for his family, only to discover that the home he left behind wasn't quite what it seemed
Cheaper energy on the way, but it's not all sunshine and rainbows

Cheaper energy on the way, but it's not all sunshine and rainbows

Solar power will help bring down electricity prices over the next five years, according to a new report. But it’s cheap imports of ‘dirty power’ that will lower them the most