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Barclays to Spend 1.4 Billion Pounds in Retail Overhaul

Barclays Plc (BARC) Chief Executive Officer Antony Jenkins said he expects to spend about 1.4 billion pounds ($2.2 billion) by 2015 in an overhaul of the consumer bank, about half the total cost of his revamp.

Britain’s second-largest lender by assets will spend about 600 million pounds on “rightsizing, industrialization and innovation” in its investment bank, about 400 million pounds in its wealth unit and more than 300 million pounds at the corporate bank, London-based Barclays said in a statement today.

Barclays’s first-half profit was reduced by 640 million pounds of restructuring costs linked to Jenkins’s attempts to make the bank more profitable. Under the plan announced in February, the CEO pledged to save 1.7 billion pounds in expenses by 2015, cut 3,700 jobs and reduce costs to about 55 percent of income from 71 percent in the first quarter of 2013.

Jenkins, 52, who took over as CEO in August 2012 following the resignation of Robert Diamond in the wake of the Libor scandal, will give more details of his “Transform” program in a speech in New York at about 12:45 p.m. local time today.

Barclays said in the statement it expects about 800 million pounds of cost savings will come from operations and technology, 700 million pounds from the front office and 200 million pounds from human resources, finance and risk.

The shares climbed 2.1 percent to 305.75 pence in London, for a market value of about 39.3 billion pounds. They have increased about 17 percent this year, making them the second-best performer among Britain’s five largest lenders after Lloyds Banking Group Plc (LLOY), which is up 63 percent.

To contact the reporter on this story: Edward Evans in London at eevans3@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net

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