The final details of the transaction were still being ironed out on Wednesday but the sources said Barclays has agreed to sell about 90 branches in Italy and will make a payment to Mediobanca as part of the agreement.
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Get a free copy of the Zacks research report on Barclays PLC (ADR) (BCS). The bank is though, likely to be left with some £10bn of Italian mortgages, which it’s trying to sell.
Mr Staley, who started working at the bank just this week, said: “I want to take this opportunity to thank our Italian colleagues in the businesses we are selling for their hard work and professionalism which has built strong customer and client relationships over many years and has made these businesses so attractive to CheBanca”. The Italian sale will reduce Barclays’ risk-weighted assets by about £800m and result in a small decrease in its capital ratio.
The deal will have a 20 basis point negative effect on Mediobanca’s capital, which the bank said would be gradually recovered from earnings. Barclays shares were up 0.6 per cent and Mediobanca shares were up 0.7 per cent by 0850 GMT.
“This transaction is further evidence of the re-shaping of Barclays Group to focus on our core businesses”, said Jes Staley, the bank’s new chief executive.
His aim is to improve the bank’s profitability by cutting costs and shedding underperforming businesses.
MILAN/LONDON, Dec 3 (Reuters) – Barclays is paying 237 million euros to sell its branches in Italy to Mediobanca in a deal that will give the Italian investment bank a boost in a race for asset management fees on its home turf.
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Barclays is running a parallel process to sell the mortgage portfolio, worth around 1 billion euros, one of the sources said, pointing to continuing negotiations with USA asset manager Fortress Investment Group (FIG.N).
