Shares in Barclays PLC fell more than 10% on Tuesday after the British bank slashed its dividend and set out plans to sell down its African business.
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Barclays has operated in Africa for more than 100 years, and Staley described the decision to sell down its stake in Barclays Africa Group as “very hard”.
The lender reported profits fell two per cent to £5.4billion in 2015, as it took another £1.45bn hit for payment protection insurance (PPI) mis-selling. The figure was below the average forecast of 5.772 billion from a consensus of analysts’ forecasts.
Barclays confirmed in an emailed statement that King, the CEO of the group’s investment bank, will retire on March 4.
It (Other OTC: ITGL – news) would then concentrate on two divisions, Barclays UK and Barclays Corporate and global, to comply with ring-fencing regulations aimed at safeguarding its retail banking business from riskier operations.
In the few months since Staley’s appointment, Barclays has made sweeping cuts across its investment bank and exited several businesses including in Asia, aiming to trim costs, reduce risk and shore up its balance sheet.
Barclays bought a 55 per cent stake in South African bank Absa in 2005 for $5.5 billion, later increasing it to a 62.3 per cent stake and rebranding Absa as Barclays Africa in 2013.
Barclays also warned about the impact of a Brexit if the United Kingdom votes to leave the European Union in June’s referendum.
The group, which was reporting its first annual results under new chief executive Jes Staley, said core profits were up 3% after a strong performance by Barclaycard, especially in the U.S., and steady income from its under-pressure investment banking arm. Barclays Africa was created three years ago under a deal in which the British bank handed over ownership of its businesses in eight African countries to its South African subsidiary in exchange for a 62.3 percent stake in the new entity. “We are not exiting our operations in any of our African markets”, Ramos said.
Staley has been tasked with restoring the bank’s battered reputation caused by a series of scandals including the rigging of foreign exchange and Libor interest rate markets.
Barclays is meanwhile axing thousands of jobs as it seeks to slash costs.
Analysts said Barclays could not be selling at a worse time and they will struggle to find buyers, but Chinese banks might be interested.
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The move to cut the dividend led to an 11 per cent dive in Barclays share price, leading to trading being temporarily halted. More fines could wash over the bank as Barclays’s management team pledged to address all remaining conduct issues this year.
