The programme will see the banks global workforce fall below 100,000 by the end of 2017, and with aims of doubling its share price, the move will try to target the banks chronic underperformance, according to senior sources.
Antony Jenkins, the former chief executive of barclays, was let go earlier this month after failing to get a hold on the bank’s cost base. His successor will be expected to cut the number of employees from 132,000 to just under 100,000 in one of the most dramatic redundancies the company has suffered.
According to The Times, the cull of staff will not affect the running of stores, however, as barclays plan on automating manual processes within its retail bank. The majority of jobs that will be lost will fall on middle and back office operations, where it is thought the largest savings can be achieved.
Mr Jenkins faced criticism for not being radical enough in replacing labour-intensive operations with technology in comparison to Lloyds Banking Group and Royal Bank of Scotland, even though he had been enthusiastic over the move.
Lloyds and RBS have each slashed tens of thousands of jobs since the crisis. In 2009 Lloyds employed 132,000, but today has a staff of 95,088, a drop of 37,111, while the cull at RBS has been even more dramatic with its global workforce more than halving from 183,700 to 89,700, though some of this fall has come from sales of businesses rather than redundancies.
By contrast, at Barclays in the past six years the total headcount has dropped by only 12,000. Last year, the bank announced the introduction of a new redundancy programme, but even this is thought insufficient to deliver the types of savings investors want to see the lender make.
Under Mr Jenkins’s Transform plan, more than £2 billion was shaved off the group’s costs, taking the bank’s total operating bill to £16.9 billion last year. This rate of shrinkage disappointed shareholders and after an initial rise in the bank’s stock market value, its share price has stagnated over the past couple of years.
A search is about to get under way to find a replacement for Mr Jenkins. However, senior sources at Barclays said that whoever took the job would be expected to swing the axe much faster and more deeply than the lender’s ousted boss.
Last week, the bank faced further pressure as it emerged that Sir Michael Rake, its well-regarded deputy chairman, had accepted the chairmanship of Worldpay before the payment processing company embarks on an expected £6 billion London IPO.
After initial confusion, Barclays was pushed by the Bank of England to put out a statement confirming that Sir Michael would remain with the lender until a new boss had been identified, heading off concerns that John McFarlane would have an overly dominant role as executive chairman.
It was Sir Michael and Mr McFarlane, the chairman only since January, who engineered the departure of Mr Jenkins after a disastrous board meeting offsite at which the scale of disapproval in his running of the bank became fully apparent to directors.
Barclays declined to comment.
