Barclays is exiting its Bmarkets in Europe as part of the strategic review announced by the former chief executive Antony Jenkins which designated the business as non-core. However, the bank said in a statement that it “remains committed to its structured products business” and will continue to provide structured investments through Barclays Wealth & Investment Management and Barclays Investment Bank.
“As a result of this strategic review, Bmarkets was designated non-core,” said the UK bank in a statement. “In line with its strategy, Barclays is now announcing its intention to exit its Bmarkets business.”
Bmarkets comprises Barclays Bank’s listed retail structured products, and was launched in 2010, with the aim of facilitating the distribution of financial products “replicating a wide range of underlying assets”. Bmarkets operates in four European countries: France, Italy, Germany and Switzerland. “Barclays will no longer be issuing new Bmarkets products and will only be providing bid prices on outstanding Bmarkets securities,” stated the bank. “Barclays intends to pay a premium in respect of its bid prices, subject to Barclays’ discretion, of around 3% above fair market value.”
As part of the process, the bank intends to call remaining outstanding Bmarkets products which have not been sold back or which have not otherwise been redeemed. “Investors will be informed of the issuer call in accordance with the relevant prospectuses,” stated the bank. “Investors who do not sell back during the bid-only period will still benefit from a premium upon the issuer call: Barclays intends to pay a premium in respect of the call price which will be in line with the premium paid during the bid only period, subject to Barclays’ discretion.”
Barclays also warned investors that until a Bmarkets product is called or is sold back, investors will still be subject to the market fluctuations and risks which normally affect these products. “Bmarkets products which redeem due to normal market movements will not benefit from a premium,” stated Barclays.
The announcement is part of Barclays’ plans to cut 19,000 jobs and revamp its struggling investment bank which saw the bank restructuring its equity derivatives/structured products investor solutions division, and launching a new equities and funds structured (EFS) markets in the summer of 2014.
EFS markets has three areas of focus, including non-linear derivative solutions (structured notes, principal protected products, equity and hybrid structured options, credit solutions and structured solutions) for investor clients such as asset managers, insurers, private banks and other financial intermediaries; quantitative indices and strategies (QIS) across-asset classes, including cross-asset risk premium portfolios for endowments, protected long-term savings products for pension funds, customised protected solutions for insurers and structured investments linked to mutual and hedge funds; and structured financing and collateral solutions including global margin, collared financings and multi-asset collateral management.
Under the new regional set up, Corinne Grain was appointed head of EFS sales, Europe, Middle East & Africa (Emea), with Johnny Wu and Yasuhiro Ishibashi as her counterparts in the US and Asia Pacific, respectively. At a product development level, Richard Couzens, who left the bank last week, was appointed co-head of the expanded global product origination team across EFS, alongside Brad Hurrell, formerly head of structuring, Emea. Couzens’ responsibilities have been passed to Ian Merrill, managing director, head of exchange-traded notes and global platforms, EFS Solutions, in New York.
In addition, David Wood, the former head of direct and listed solutions at Barclays in London, who was behind the development of Barclays’ fully-integrated internet-based services and solutions including Barx IS platform, the Barx Comet platform the bank’s Bmarkets platform, left the bank to join Societe Generale as head of electronic business, cross-asset solutions in London.
Barclays Bank has also offloaded its retail banking, wealth and investment management and corporate banking businesses in Spain which was sold to CaixaBank (formerly La Caixa), as well as its Portugal-based non-core assets to Spain’s Bankinter.
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