LONDON (Reuters) – Barclays is exploring options for its global payments business as part of a broader review of how it disposes of its resources, two sources familiar with the matter told Reuters.
Britain’s third-largest bank recently brought in consultants to analyze whether some of the payments business should be expanded or combined with other providers through a merger or joint venture. company, the sources say.
The review, which is still in its infancy and may not result in a change in structure, will focus on bank card issuing businesses and those that offer payment services to merchants, said one of the sources.
Barclays has already engaged at least one major consultancy and may engage others to distribute the tasks, one of the sources said.
“All three businesses continue to perform well and our business mix is strong – growing our global payments business is a priority for us,” a Barclays spokesperson said.
Barclays’ payments business is split between its UK business, Barclaycard, and its international Consumer, Card and Payments (CC&P) unit, whose revenue grew 35% last year to $4.5 billion. pounds (5.23 billion euros), thanks to the increase in card balances in the United States. CC&P, however, reported a 19% decline in pre-tax profit due to higher impairment charges.
Barclays has also brought in the Boston Consulting Group (BCG) to review the entire banking group, a source familiar with the matter told Reuters. Bloomberg News had reported this review by BCG in May.
The way the bank must allocate its resources between the more predictable retail business and the volatile returns of investment banking have caught the attention of investors.
Disappointing profits in 2022 and rising costs have weighed on Barclays shares, which have fallen around 1.6% this year, underperforming the STOXX600 index of European banks which have gained around 6.8%, while rivals such as BNP Paribas and HSBC took 5% and 17% respectively.
A brokerage error that resulted in a $361 million fine from US authorities has also raised concerns among investors about the investment bank’s potential risks.
(Reporting Amy-Jo Crowley and Pablo Mayo Cerqueiro in London, with contributions from Stefania Spezzati and Lawrence White; French version Lina Golovnya, editing by Kate Entringer)
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