Barclays PLC is reportedly in the initial stages of formulating an ambitious cost-cutting plan that could result in savings of up to £1 billion ($1.3 billion) over the next few years.
The proposed measures, still under review by top management, might include a workforce reduction of as many as 2,000 jobs, primarily at Barclays Execution Services, the unit encompassing the bank’s back-office operations.
While discussions are ongoing, the plan aims to enhance profitability, potentially resulting in the elimination of 1,500 to 2,000 jobs, constituting approximately 2% of the bank’s total workforce.
Barclays is strategically evaluating actions to reduce structural costs as part of its efforts to drive future returns.
The bank anticipates that these cost-cutting initiatives might lead to significant additional charges in the fourth quarter.
Barclays, with total operating expenses of £16.7 billion last year, is grappling with a challenging financial landscape.
The bank’s share prices have declined by 11.5% this year, prompting Chief Executive Officer C.S. Venkatakrishnan to engage strategy advisers to devise plans aimed at reviving the bank’s share performance.
A Barclays spokesperson declined to comment on the ongoing discussions and proposals. The bank revealed last month that it would provide an investor update in February, coinciding with its full-year results announcement.
This update is expected to include a new strategic direction.
Barclays Execution Services Ltd. (BX), the unit potentially affected by these cost-cutting measures, had 22,334 full-time staff at the end of 2022.
The unit provides technology, operations, and functional services to various businesses within the Barclays group.
As the discussions evolve, the bank may prioritize layoffs in other areas to achieve its objectives in optimizing structural costs.
Investors await further details during the upcoming investor update, where Barclays is expected to outline its fresh strategy to navigate the complex financial landscape.
