Scandal-hit Barclays announces major cuts

Bank says at least 3,700 jobs will be cut after it is forced to pay $435 million fine for manipulating interest rate.

    Scandal-hit Barclays announces major cuts
    Barclays new CEO, Antony Jenkins, said ethics count and matter more than what happens in the fourth quarter [AFP]

    Barclays PLC has announced plans to cut at least 3,700 jobs in a major restructuring that follows a scandal-hit year for the UK bank.

    The bank said on Tuesday it would cut at least 1,800 positions in the Corporate and Investment Bank unit and 1,900 retail and business banking jobs outside the UK.

    The cuts come after the British institution was forced to pay US $453 million fine for manipulating a key market interest rate that serves as the basis for trillion in mortgage loans.

    A slew of executives, including chief executive, Bob Diamond, were forced to resign.

    "It's not complicated... It's about recognising that we're in business to serve our customers and clients, to deliver return for our shareholders. But also to be good for the societies where we do business... and we will be judged by our actions, not our words."

    - Barclays CEO Antony Jenkins

    It also faced criticism for mis-selling of insurance and interest rate products to consumers and small businesses.

    The bank's new CEO, Antony Jenkins, has warned his staff that making money will not be the only thing on which they will be judged.

    Ethics count - and matter more in the long-run than what happens in the fourth quarter.

    Barclays has closed the structured capital markets business - which sought ways for its customers to pay less tax on their investments - as well as cutting bonuses and removing branch sales incentives.

    Barclays recorded a loss of 236 million pounds (US $368 million) for 2012 against a net profit of 3.9bn pounds for 2011.

    It made 2.45bn pounds in provisions in 2012 for compensating clients for the mis-sold products.

    SOURCE: Agencies


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