Barclays sells index division for £520m

BARCLAYS has agreed to sell the indexing business built around former Lehman Brothers benchmarks to Bloomberg for about £520m, as CEO Jes Staley speeds up disposals of unwanted assets.

Barclays said yesterday it would post a £480m gain from selling the risk analytics and index solutions business, boosting its regulatory capital level by 0.1 percentage point.

The deal needed antitrust approval and should be completed “mid-2016”, Barclays said. Bloomberg is the parent company of Bloomberg News.

The bank’s indices, such as the Global Aggregate, are widely used as corporate bond benchmarks by portfolio managers. Much of the business was acquired in 2008, when Barclays absorbed Lehman Brothers’s North American unit.

Mr Staley, a 58-year-old veteran of JPMorgan Chase, was hired by chairman John McFarlane in October to accelerate the bank’s restructuring and refocus on its most profitable UK and US businesses.

“This transaction is further evidence of the good work we are doing in managing down our noncore assets so that shareholders can feel the full benefit of ownership of Barclays’s well-performing core businesses,” Mr Staley said.

The division being sold, known as BRAIS, also builds bespoke indices and structured products for clients, allowing them to gain exposure to specific markets, according to Will Bowen, a spokesman for the London-based lender.

The indices Barclays acquired from Lehman were the first to be published, beginning in 1973, the firm said at the time of the transaction. Barclays combined the Lehman benchmarks with its own and renamed the amalgamated measures the Barclays Capital Indices in November 2008.

While the purchase price equated to $781m at yesterday’s exchange rate, Barclays gave it a $790m value in the statement, using a rate of $1.52 to the pound.