Barclays looks at return to SA
• Investment bank said to be exploring way to get back into the country and South Korea
Barclays’s investment bank is exploring ways to reenter the South African and South Korean markets, in a break from the transatlantic retrenchment embarked on a few years ago.
Barclays’s investment bank is exploring ways to re-enter the South African and South Korean markets, in a break from the transatlantic retrenchment embarked on a few years ago.
Two people familiar with Barclays’s plans said discussions were at an early stage but SA and South Korea had been identified as two of the markets where the investment bank would like to rebuild operations.
Barclays International, which includes Barclays’s investment bank, private bank and cards business, has already reopened an office for its investment bankers in Australia, reversing a retreat made two years ago.
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In 2017 the Financial Times reported that Barclays International was keen to send private bankers back to Asia after a noncompete agreement linked to the 2016 sale of its Asian wealth management business expires. The sale was part of a 2016 retreat from Asia, Brazil and Russia, including the closure of the bank’s cash equities business in Asia, as Barclays sought to rebuild itself around its strongest markets of the UK and the US.
Selling most of its majority stake in Barclays Africa was another major plank of the bank’s strategic revamp to become a simpler business under Jes Staley, the former JPMorgan banker who became Barclays group CEO in December 2015.
One person familiar with Barclays International’s current plans said the bank was exploring opening a representative office in SA so that it could offer banking services to clients. The bank was cognisant that any service would have to satisfy the terms of a multiyear noncompete agreement with Barclays Africa, the person said.
Barclays Africa CEO Maria Ramos dismissed the potential threat from Barclays International, which is excluded from many African markets until June 2020 under the terms of their noncompete agreement.
“I can tell you unequivocally that unless you have a branch on the ground and a bank on the ground, it doesn’t matter how many times you fly in, you don’t have the local knowledge,” Ramos told the FT.
“I don’t mind the competition. Let’s see who wins.”
Barclays still owns 14.9% of its former African offshoot. It reduced its stake from 62.3% by
THE BANK WAS EXPLORING OPENING AN OFFICE IN SA SO THAT IT COULD OFFER BANKING SERVICES TO CLIENTS THERE
selling shares on the JSE in two tranches in 2016 and 2017.
Barclays does not have a noncompete to consider in South Korea, but would not want to annoy regulators by reentering a market it left so recently. People familiar with the situation in South Korea said Barclays had not yet begun the process of applying for a new licence.
Barclays would not comment on its intentions for either SA or South Korea.
When the bank announced its return to Australia, it stressed the commercial opportunity, as well as that it was re-entering with a small and focused team that would consume a lot less capital and resources than the former Barclays Australia.
The first person said Barclays would consider getting back into markets it previously exited “if someone can make the case … that our business has evolved, that there are more opportunities, that reopening makes sense”.