[LONDON] Barclays Chairman John McFarlane has pledged to deliver a "clean and prosperous" 2018 to investors, putting a deadline on a vast programme of restructuring and asset sales that will see staffing numbers fall by 50,000.
Speaking at the bank's annual general meeting (AGM) in London on Thursday, McFarlane thanked investors for their patience while Barclays runs down businesses it no longer sees as capable of generating appropriate returns, against a backdrop of rising regulatory costs and poor economic conditions.
Following these disposals, which include the sell-down of its 62 per cent stake in Barclays Africa, McFarlane said the bank expected group full-time employees to reduce by around 50,000 people, resulting in a total headcount of 80,000 - almost half the staff employed at its peak.
The cost savings achieved from these cuts and the refocusing of the business would enable the bank to reintroduce a "respectable dividend level" and transform Barclays into a"significantly smaller, safer" bank, McFarlane said. "For the past few years, we have produced either negligible retained profits or losses before dividends. Going forward we need to reverse this and generate superior returns out of our franchise," McFarlane said, in his first AGM statement as chairman. "However it is worth remembering that we are in the process of turning around what was recently the largest bank in the world by assets," he added.
Chief Executive Jes Staley also took time to explain a decision to sacrifice part of the dividend to fund the revamp, but said the short-term pain was necessary to put Barclays in a position to grow payouts over time. "Investing substantially in this company was one of the first things I did upon being appointed - and my interests are firmly aligned with yours," he said. "However, I believe it is better to move quickly and decisively to eliminate the drag in this business now than to accept high levels of attrition on your returns for a much longer time than is necessary." Staley also said the bank was working hard to relieve the pressure on returns from fines for past conduct failings and was seeking to resolve outstanding issues "as swiftly as possible".
"There will also be no let-up in the critically important work to transform Barclays' culture," he said.