Newspaper article The Evening Standard (London, England)

Bramson's Wheeze Is Bad All Round: Stick with Staley; Kiss Goodbye to Lucrative Jobs

Newspaper article The Evening Standard (London, England)

Bramson's Wheeze Is Bad All Round: Stick with Staley; Kiss Goodbye to Lucrative Jobs

Article excerpt

Byline: Jim Armitage City Editor COMMENT

EDWARD Bramson's plans are bad for Britain, bad for Europe and bad for Barclays.

From his Wall Street eyrie, he looks across the Atlantic and declares Barclays should ditch its Markets trading business to focus on High Street banking and advisory work, the side of investment banking where expensively suited public schoolboys guide companies through takeovers.

By shedding the investment bank, he argues, Barclays would no longer have to keep billions of pounds aside to cover potential losses. Instead, those billions could be returned to shareholders or invested elsewhere in the business.

Sounds simple, doesn't it? But let's think of the implications: Barclays is the sole major UK player left in full-service investment banking, our last "bulge-bracket" bank, as they say in the trade. If Deutsche Bank shrinks under its new chief Christian Sewing, it will be the only remaining bulge-bracket player in Europe, too. We will become dependent on a small group of maybe four or five US banks.

So what? you may say. Who cares if we don't have our own casino banks? We should.

Despite the negative press investment banking rightly got during the financial crisis, we mustn't lose sight of what bulgebracket banks do; help governments and companies raise money. That's cash to keep our schools and hospitals going and help employers invest in their businesses and employ more people. Important stuff.

Sure, the US giants would be delighted to step into the breach and snap up Barclays' share of the market now. But what happens if we get another financial crisis and they decide, as they did in 2007, to rein in Continued on Page 52 Commentary continued from Page 51 lending? Will they be as open to funding Brits as much as their home markets? Of course not.

What if, post-Brexit, they decide to move their operations to the continent. …

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