Barclays to Slash 3,700 Jobs Amid Cost Cutting

Barclays is axing at least 3,700 jobs and pruning its investment bank as its new boss put his stamp on the troubled British bank by aiming to cut 1.7 billion pounds ($2.7 billion) in annual costs and raise standards after a series of scandals.

The plans form part of an overhaul which Chief Executive Antony Jenkins hopes will convince a sceptical public that he can change a bank which has been dogged by controversy, including a $450 million fine for rigging Libor interbank lending rates.

"I understand the cynics and the sceptics out there, but cynics and sceptics never built anything. It will take years before people actually change their impression of us. I'm not daunted by that at all," Jenkins told BBC radio.

Jenkins is taking a harder line on pay and Barclays said it had cut the average bonus for its investment bankers to 54,100 pounds for last year, down 17 percent on the year. It will pay 1.85 billion pounds in bonuses, down 14 percent on the year.

Barclays said the job cuts will include 1,800 in corporate and investment banking and 1,900 in its European retail and business banking. Finance Director Chris Lucas said 1,600 of the investment bank cuts had already been made.

Jenkins plans to focus investment in Britain, the United States and Africa, and reduce the bank's presence in continental Europe and Asia.

That will include a scaling back of the investment bank's equities and advisory businesses in continental Europe and Asia. It will refocus its retail businesses in Italy, Spain, Portugal and France on mass affluent customers.

Jenkins, 51, has said he expects his plan, dubbed "Project Transform", to take five to 10 years to rebuild Barclays, and has told staff they should leave if they do not want to sign up to the new standards.

Barclays shares were up 4 percent by 0930 GMT, the best performer in a flat European banking index.


Jenkins aims to cut the bank's cost base to 16.8 billion pounds in 2015, excluding one-off costs to achieve that of 2.7 billion over the next three years, and lift its dividend to achieve a 30 percent payout ratio.

The bank will pay a dividend of 6.5 pence per share for 2012 from 6p in 2011, which analysts said was encouraging given that UK regulators are telling banks to conserve capital.

"We take this as a positive for the UK banks - the fact that a bank was allowed to increase its dividend in a backdrop where the Bank of England has been talking about capital holes in the UK banks," said Chira Barua, senior analyst at Sanford Bernstein.

Jenkins, a retail banker who was picked at the end of August to run the bank after his predecessor Bob Diamond was forced to quit, will unveil more details on his plan to media and investors later on Tuesday at London's Edwardian Royal Horticultural Halls.

He will reduce the balance sheet by cutting legacy assets. Barclays held 387 billion pounds in risk-weighted assets at the end of December, but that would be equivalent to 464 billion under stricter capital rules coming into force, and Jenkins said he aims to reduce that to 440 billion by the end of 2015.


Much of his focus has been on changing standards and culture that have been criticised as too lax after the bank's Libor fine, the mis-selling of products to millions of customers and investigations into whether Barclays provided enough disclosure in fundraisings from Middle East investors.

The Financial Services Authority and Serious Fraud Office are investigating certain commercial arrangements between Barclays and Qatari investors related to two 2008 fundraisings.

The bank confirmed it will close its controversial but profitable tax advisory business.

Jenkins' plan to keep but scale back the investment bank was expected, as it contributes more than half of group earnings.

Unveiling the strategic plan alongside annual results, the bank reported a 2012 pretax profit of 246 million pounds, down from 5.9 billion in 2011 due to the cost of compensating customers and losses on the value of its own debt.

However, the bank said its adjusted pretax profit for 2012 was 7.05 billion pounds, up 26 percent on the year and in line with the average forecast by analysts.

Pretax profit at the investment bank rose by 37 percent to 4.1 billion pounds, stronger than expected. Income in the investment bank was down 2 percent from the previous quarter, but up 13 percent on a year ago, with fixed income, equities and advisory arms all up.

The bank said it had a good January. "We've had a good start to the year, pretty much across the board and all businesses so we move into the rest of 2013 with confidence," Lucas told reporters on a conference call.


Grammys Ratings Second Best in 20 Years

Sunday night's Grammy Awards drew 28.12 million viewers, a 29.5 percent drop from the record-breaking CBS telecast in 2012. (Viewers between 18 and 49 also dropped 27 percent.) The decline was no surprise – last year, the extraordinary circumstances of Whitney Houston's unexpected death a day before the show led to a hastily arranged tribute starring Jennifer Hudson. Still, the numbers for this year's 55th annual ceremony were strong, as the live broadcast from the Staples Center in Los Angeles landed its second-best TV ratings since 1993.

Albums may not sell the way they did 20 years ago, but the record industry's star power remains surprisingly resilient, and the broadcast nicely mixed established names with rising talent and drama both manufactured and poignant. The world's two best-selling pop stars, Taylor Swift (in a circus-like opening performance of "We Are Never Ever Getting Back Together") and Adele (whose acceptance speech for Best Pop Vocal Performance for a live version of "Set Fire to the Rain" was far briefer and less all-encompassing than last year), were present, of course. So were veterans such as Mumford & Sons, Justin Timberlake and Kelly Clarkson.

But the show's most intriguing performances came via big-time debuts – Miguel (who dueted with rapper Wiz Khalifa in black-and-white jackets), Frank Ocean (who performed "Forrest Gump" and won Best Urban Contemporary Album), Fun. (which performed "Carry On" and won both Song of the Year and Best New Artist) and Gotye (who won Record of the Year). Making a case for the future health of rock were the Black Keys (who won for Best Rock Song and Best Rock Album and killed it with the Preservation Hall Jazz Band and Dr. John on "Lonely Boy") and Jack White (who provided old-fashioned rebellion with an apparent f-bomb during "Love Interruption").

Subplots, amplified by Twitter and Facebook, were also plentiful – Katy Perry's cleavage openly flaunted the Grammys' (perhaps savvy) pre-show memo mandating that stars cover up;  Chris Brown pointedly remained seated during a standing ovation as his rival, Ocean,  accepted his award; Brown and Rihanna, once embroiled in domestic violence, sat with each other; and online GIFs replayed Swift cheerily bopping to Mumford and other acts.

As with last year's broadcast, the "in memoriam" section was sadly robust. Two of the show's most emotional highlights were tributes to the Band's Levon Helm (starring Elton John and an overwhelming Mavis Staples) and the closing hip-hop homage to Beastie Boy Adam "MCA" Yauch (with Public Enemy's Chuck D, host LL Cool J and Rage Against the Machine's Tom Morello). If Ocean, Miguel, Fun., Black Keys and Gotye develop to their potential, perhaps future Grammys won't need death for ratings success.