Barclays’ Australian exit: Company succumbs to strict regulations, slow markets and competition

As part of a global restructure, Barclays is exiting Australia, effective immediately. The investment bank, in a bid to cut costs by slashing jobs across the Asia-Pacific region, will now refocus entirely on its core markets – Britain, Europe and the US. As a result of the closure, around 80 Australian staff are expected to lose their jobs. Barclays established its roots in Australia in 1969.

The bank is also exiting from other markets in Asia. Around 230 people can lose their jobs in Asia-Pacific and more than 1,000 globally. The withdrawal, as part of a global restructure, was mainly planned by Barclays’ newly-installed chief executive, Jes Staley. Malaysia, South Korea and Taiwan will also see the company exit.

The bank is also closing entire lines of businesses such as sales and trading, cash equity research and convertible bond trading. Jobs will be lost across areas of lending, debt capital markets, foreign exchange and risk management, and mergers and acquisitions, sources revealed.

The exit of Barclays from Australia comes right after Commonwealth Bank of Australia's decision to shut its institutional equities division and capital markets business and the withdrawal of Canada’s GMP from the local market. Even Nomura closed its local institutional equities franchise while Malaysia's CIMB bid adieu from Australia last year.

It was Chairman John Macfarlene (former chief of ANZ) who installed Staley in October. He had earlier said that Barclays did not want to be a “100-country investment bank” and that Asia was not making money.

According to a former Barclays banker, the Australia withdrawal had been in the works for quite some time and Asia truly did not make money for a long time, reports The Australian. Royal Bank of Scotland (RBS) also decreased its presence in Australia under Australian chief executive Ross McEwan.

Barclays, in recent years, has suffered due to the loss of several senior bankers such as Anthony Lazzoppina, Steven Boggiano, Tim Lindley, Dan Janes and Cynthia Whelan. Moreover, the investment bank was never able to build an equities arm with the entire suite of service offerings as offered by competitors such as Goldman Sachs and UBS.