MUMBAI (Reuters) - Barclays Plc (BARC.L) is to close its Indian equities business as part of efforts to cut costs and boost profit, two sources with direct knowledge of the plan said on Monday.
The British bank’s equities business in India, which was rolled out in 2011, includes research and broking for institutional investors, and employs some two dozen people, the sources told Reuters.
The planned closure is part of Chief Executive Jes Staley’s wider plan to cut costs, the sources, who declined to be named, said.
Barclays is midway through a three-year cost-reduction plan, which involves shedding 19,000 jobs, or about 14 percent of its global workforce. In November, the bank put a freeze on hiring until the start of 2016.
A spokesman in India for Barclays, whose other operations in Asia’s third-largest economy include corporate and investment banking, and wealth management, declined to comment.
The London-headquartered bank planned to cut more jobs in its investment banking unit, Reuters reported last month. Most of these cuts were expected to be in Asia.
Barclays is also weighing the sale of its Asian private wealth business, for which Singapore’s DBS Group Holdings (DBSM.SI) and Julius Baer BAER.VX are seen as potential bidders, sources told Reuters last month.
The planned shut down of Barclays' equities desk in India comes against the backdrop of a drop in the local stock market - the broader Mumbai stock market index .NSEI fell 4 percent in 2015 - and tough competition from Indian rivals.
Last week, Societe Generale (SOGN.PA), France’s second-biggest bank by market value, said it would shut its equities research desk in India as part of an internal reorganisation.
Barclays, a late entrant to the Indian equities business, had rolled out its equities business in India at a time when sluggish market conditions had hit volumes and fierce competition had driven down fees.
But it had managed to gain market share in the last couple of years by focussing on foreign as well as domestic institutional investors, one of the sources said.
Reporting by Sumeet Chatterjee; additional reporting by Savio Shetty; editing by Susan Thomas and Alexander Smith