Barclays
Wealth is planning to double client-facing staff numbers and
upgrade its technology platform in 2010 with an investment of £350
million.
Two thirds of the investment will be spent on
upgrading the bank’s systems, with the remainder directed
towards new hires, according to a spokesman. None of the cash has
been earmarked for acquisitions. The investment in Barclays Wealth
is seen as necessary for the business to achieve CEO Tom Kalaris’
aim of being seen by clients as one of the top five wealth managers
globally.
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“In the area of wealth management, the
competitive landscape has gone through a sea change over the course
of the last three years,” said Barclays CEO John Varley. “That
creates opportunity, and we intend to seize that by investing to
change the scale of this business over the next five years.”
The news comes as it emerged Barclays Wealth
cut 500 staff (6 percent of its work force) in 2009 and profit
declined 78 percent to £145 million. The cuts, announced in the
bank’s annual results, were said to be “a result of active cost
management, including efficiency savings in non-client facing
areas”.
The main items contributing to the decline in
profitability were an exceptional gain in 2008’s figures of £326
million from the sale of its closed life assurance business and a
loss of£39 million at the Lehman Brothers unit it acquired in late
2008. The loss at the unit, now branded Barclays Americas, was
partly the result of reorganisation costs.
Total clients assets increased 4.3 percent to
£151.3 billion, with net new assets of around £3 billion (2
percent). Overall, profit at Barclays Wealth declined 58 percent,
excluding the impact of the sale of its closed life assurance
business in 2008’s figures.
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