Barclays is drawing up plans to lay off as many as 2,000 staff as it seeks to cut its costs and reverse its declining profitability.
The London-headquartered bank is working on plans to save up to GBP1 billion ($1.25 billion) by laying off between 1,500 and 2,000 mainly back office staff, according to Reuters.
Shares in Barclays (UK:BARC) (BCS) were flat on Friday having lost 12% of their value over the previous 12 months.
Barclay’s plans dovetail with efforts led by company chief executive C.S. Venkatakrishnan to boost the bank’s profitability, as the lender readies itself to unveil a new strategy in February 2024.
Venkatakrishnan has faced growing pressure to increase the bank’s profits, amid a 27% drop in the bank’s share price since he took over as CEO in November 2021.
The job cuts would mainly be aimed at staff working in the bank’s operational support division, Barclays Execution Services, which is known as BX inside the company.
First formed in 2017, BX provides back office support to the two separate U.K. retail and international banking divisions that make up Barclays’ business.
The cost-cutting plans are, however, still being reviewed and could see staff laid off in other areas of Barclays’ business.
Barclays currently employs 85,000 staff worldwide, including more than 22,000 workers inside BX, which currently has staffing costs of GBP2 billion.
Barclays’ staffing costs have surged over the past three years, from GBP8.1 billion in 2020 to GBP9.3 billion in 2022.
The bank, which was first established in 1690, has made efforts to reduce its outgoings in recent years, including by slashing employee bonuses and laying off staff.
In October, the Barclays CEO, who is known as Venkat inside the company, said the bank is looking to “increase productivity” after it reported a 4% drop in its third-quarter pre-tax profits.
The FTSE 100 bank is currently working with consulting firm Boston Consulting Group (BCG) to develop a strategy to boost shareholder returns, Reuters reported in June.
Barclays declined to comment. BCG was contacted by MarketWatch for comment.