Barclays sells Italian division at £258m loss in drive to sell off non-core assets

BARCLAYS HAS offloaded its loss-making Italian business as part of its drive to sell off noncore assets.

The bank said that its retail banking operation, consisting of 85 branches employing 564 staff, would be sold to Mediobanca at a £258m loss.

Barclays will pay a 240.5m euro dowry to Mediobanca, which has 220,000 customers, to take the business off its hands.

Jes Staley, chief executive of Barclays, said: “Accelerating the rundown of Barclays non-core is a key part of our strategy to close the gap between the group’s returns and those in our strong core business.”

The move is part of the lender’s strategy of focusing on its core UK and US banking operations by closing its hinterland businesses.

The overhaul has seen the lender sell its Barclaycard credit card operations in Spain and Portugal to Bancopopular-e and sell down its 62.3 per cent stake in Barclays Africa.

Last week, the bank sold its risk analytics and index unit to Bloomberg for about £615m.

The bank sacked previous CEO Antony Jenkins last year after lacklustre revenue growth and flat share performance. Mr Jenkins, who was a retail banker, toned down the investment banking side of the business at Barclays following the Libor ratefixing scandal. However, Mr Staley’s appointment is a sign that Barclays wants to renew its focus on investment banking.

A corporate makeover at Barclays under Mr Staley is showing signs of paying off as the British bank reported an improved performance in its key businesses last month.

Mr Staley in March set out a strategy to simplify the bank’s structure and seek higher shareholder returns through the sale of the bulk of its Africa business and other assets, becoming a “transatlantic” bank focused on the United States and Britain. In its half-year results the bank posted a profit before tax of £2bn compared with £2.6bn for the same period a year ago.