Barclays is reportedly planning to shut down its commodities unit including large parts of its metals agricultural and energy business.
The closure comes as commodity trading unit goes through a sharp slide in revenues and attracts greater scrutiny from regulators, according to a Financial Times report.
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The publication quotes Barclays CEO Antony Jenkins saying that bank is planning a strategic update for investors on 8 May that is likely to cull several thousand jobs in areas that do not generate returns over their cost of capital.
Jenkins added that such units are expected to be moved into an internal bad bank and either sold or shut down.
Under the new strategy, the bank is planning heavy job cuts among the 160 staff in its global commodities trading, sales and research operations, mostly based in London. In addition, precious metals trading unit will move into the bank’s foreign exchange trading business.
The withdrawal comes amid tighter regulation, fresh capital constraints and lower profitability due to stable prices for oil and other commodities.
At the same time, Barclays is seeking to merge its equities and bond trading units under the control of Joe Corcoran, previously head of equities.
