Barclays PLC (BCS - Free Report) has been putting in efforts to simplify its operations by vending off non-core businesses. In sync with this, the company just completed the sale of its French retail banking business to AnaCap Financial Partners, a European private equity firm.
According to the agreement, Barclays has sold its 74 retail branches, a life insurance business, wealth and investment management and brokerage operations in France to AnaCap. Moreover, now all its retail as well as wealth and investment management employees in France will be transferred to AnaCap’s portfolio of companies. However, the business will carry on with the brand Barclays for the next 12 months.
Barclays mentioned that the transaction is likely to reduce its risk weighted assets by approximately £0.5 billion and annualized costs by £150 million.
AnaCap specializes in European financial services. Its investments in banks comprise Aldermore in the United Kingdom, MeDirect in Belgium; Mediterranean Bank in Malta; Equa bank in the Czech Republic; and Nest Bank in Poland.
The company has been continuously striving to simplify operations and focus on its core businesses. With this aim, it has been divesting or closing less-profitable operations that do not fit its business strategy. Also, this marks the sale of the last retail banking operation of Barclay in Continental Europe.
We are of the opinion that the company’s constant divestiture of non-core operations worldwide will help it in improving operational efficiency and reducing expenses. And these factors will eventually translate into better profitability.
Shares of Barclays have gained 7.1% over the last 12 months compared with the industry’s growth of 23.0%.
Currently, the bank carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the same space are KB Financial Group Inc. (KB - Free Report) , ING Group N.V. (ING - Free Report) and Bank of N.T. Butterfield & Son LTD (NTB - Free Report) .
KB Financial Group Inc. has witnessed 16.2% upward earnings estimate revision for the current year, in the past 60 days. Moreover, its shares have gained 22.6% over the past 12 months. It sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ING Group’s earnings estimates have been revised upward by 4.1% for the current year, in the past 60 days. Also, the stock has gained 37.2% over the past 12 months. It also carries a Zacks Rank of 1.
Bank of N.T. Butterfield & Son’s earnings estimates were revised upward by 1.5% for the current year, in the past 60 days. Also, its shares have jumped 30%, over the past 12 months. It carries a Zacks Rank of 2 (Buy).
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