Barclays Bank PLC has shifted a significant portion of its wholesale banking operations in the United States to Barclays de Zoete Wedd, its investment banking unit.
The bank said recently that the unit has set up a special group to handle investment banking securities related activities, trading, and large corporate lending in this country.
The new U.S. investment banking group will also take over Barclays' corporate banking and structured finance business, loan syndications, and mezzanine lending operation.
Richard Webb, U.S. chief executive for Barclays, said the transfer was part of a strategic decision made at the beginning of this year to give the investment banking unit overall responsibility for corporate related business in the United States.
He added the move would centralize corporate finance activities under the unit's management and enable the bank to expands its range of services and provide others through Barclays de Zoete Wedd offices around the world.
"What we're emphasizing is that relationships with our clients are based not purely on lending but on investment banking as well," said Mr. Webb.
Refocusing on Fee Business
According to a statement released by the bank, Malcom Le May, head of corporate finance for Barclays de Zoete Wedd in London, and John Sunderland, head of structured finance, have been named to head the new unit, which has assets of $8.2 billion and staff of about 350.
Barclays said a major objective of the shift to refocus the bank's business on distribution-led, fee driven business and integrate U.S. investment banking-related operations with those in Europe and Asia.
The recent announcement extends an earlier decision to improve U.S. profits and shift $6.4 billion of U.S. problem assets to Barclays de Zoete management.
Barclays lost $427.5 million in the United States in the first half this year, mainly from provisions for nonperforming property loans and losses at its home lending unit.
Rating Under Review
In August, the New York-based rating agency Fitch Investors Service Inc. said it was placing Barclays Bank PLC's AA long-term rating for structured transactions under review for a possible downgrade after estimating the bank would continue to suffer from problem loans in nearly all categories.
Structured transactions include letters of credit and liquidity facilities for asset-backed commercial paper programs.
The London-based bank has some $254 billion of assets worldwide, including more than $33 billion in the United States.
The bank earned $505.85 million before taxes in the first half this year, compared with a $509.8 million loss for the six months ended Dec. 31.