Key Takeaways
- Barclays announced a shake-up to its operations and announced billions in cost cuts, as well as stock buybacks.
- The bank will now be divided into five divisions, including a U.S. consumer bank unit.
- Barclays plans to reduce expenses by $2.53 billion and repurchase at least $12.66 billion in shares by 2026.
American Depositary Receipts (ADRs) of Barclays Plc (BCS) soared on Tuesday as the U.K.-based bank announced a major restructuring as well as plans to slash costs and return billions to shareholders.
Describing it as a simplification of its business, organization, and operations, the company said it would divide itself into five separate divisions: A UK Bank focused on personal and business banking and credit cards; a private bank and wealth management arm; a U.S. consumer bank; a U.K. corporate bank; and an investment bank.
Barclays said the moves “will provide an enhanced and more granular disclosure of the performance of each of these operating divisions, alongside more accountability from an operational and management standpoint.”
Barclays explained that it plans to cut expenses by 2 billion pounds ($2.53 billion) by 2026, and to buy back at least 10 billion pounds ($12.65 billion) worth of shares over that time.
In the fourth quarter, the bank reported a loss of 111 million pounds ($140 million). Group revenue fell 3% to 5.6 billion pounds ($7.1 billion).
Barclays ADRs were up 12% at $8.38 around 11:15 a.m. ET Tuesday, trading at their highest level since last July.