Barclays pondering relocation

 

Barclays
Plc is considering moving its headquarters out of London as the cost of holding
more capital threatens to make it less attractive than rival financial centres,
people familiar with the matter said.

Barclays has said its preference is
to stay in London, but Chairman Marcus Agius said in August it and other banks
had to consider where they were based as regulations shifted around the world.

The bank, which has been based in
London for over 300 years, could move to New York and has had preliminary
conversations with U.S. regulatory officials on a move and is conducting an
analysis of whether switching its domicile makes sense, according to published
reports.

The latest speculation had been
prompted by a report by analysts at UBS rather than any major change
internally, a person familiar with the matter said.

“While staff compensation is
driven by international comparisons, rewards to shareholders look increasingly
determined by local regulators.

If this difference becomes
permanent, we think Barclays has little option but to consider shifting
domicile,” UBS.

Barclays declined to comment.

UK banking regulators have
indicated banks should hold core Tier 1 capital ratios of near 10 per cent,
above the 7 per cent level dictated by global regulators.

The Independent Commission on
Banking (ICB) is also considering forcing banks to separately capitalize their
investment banks, which could cost banks billions of pounds in holding extra
capital.

The ICB does not release its final report
until September, and banks are not expected to make any decision before then.

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Customers enter a branch of Barclays bank in London.
Photo: File
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