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LONDON (Alliance News) - Barclays PLC on Friday said the completed sale of several businesses in Portugal is expected to reduce annual costs in its non-core division of unwanted assets by GBP72 million.
In an emailed statement, Barclays confirmed completion of the sale of its retail banking, wealth and investment management and part of its corporate banking business in Portugal to Bankinter SA.
The London-listed bank also completed the sale of its insurance business in Portugal to Bankinter Vida, which operates an insurance joint-venture with Mapfre SA.
"Completing the sale of Barclays' retail, wealth, insurance and part of the corporate banking business in Portugal today demonstrates further progress towards our target of managing down risk weighted assets in Barclays non-core to around GBP20 billion by the end of 2017," Harry Harrison, co-head of Barclays non-core, said in a statement. The asset sales were agreed in September 2015.
Barclays is aiming to reduce non-core risk-weighted assets to about GBP20.0 billion by the end of 2017, with the sale of the assets in Portugal to help cut GBP1.8 billion of RWAs toward achieving that target.
Having cut risk-weighted assets in the non-core arm to GBP47 billion from GBP110 billion between its creation in 2014 and the end of 2015, Barclays then added a further GBP8.0 billion of RWAs to the division as part of an "accelerated rundown" set out by new Chief Executive Jes Staley in early March.
"Accelerating the closure of non-core is the key to creating a simpler, more focused Barclays, centred around a core business which is already delivering a greater than 10% return on tangible equity today. I'm very pleased to say that today?s announcement takes us a step closer to that," Stalye said in a statement on Friday.
Staley's move to speed up the restructuring of the non-core division was accompanied by plans to cut its annual dividend to 3.0 pence per share in both 2016 and 2017, from 6.5p in 2015, a move that caught the market by surprise.
Barclays continues to operate Barclaycard, investment banking and multinational corporate banking in Portugal.
In 2015, Barclays sold it Spanish retail banking business and UK Secured Lending portfolio, and also signed agreements to sell both its Portuguese and Italian retail banks.
Shares in Barclays were up 0.8% at 151.20 pence on Friday morning.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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