News Column

Barclays stops trading in most commodities

April 23, 2014

TIM WALLACE



BARCLAYS is shutting down most of its commodities trading business after new regulations made it harder to make money in the sector, the bank said yesterday.


It will no longer trade base metals, agricultural products or most energy commodities.


But the bank will continue to trade precious metals, as well as index products and some oil and gas derivative products.


Barclays had previously warned in its annual report that rules in Europe could limit its positions in some of these markets, while authorities in the US are also clamping down on proprietary trading.


Barclays said "this decision will have no material impact on the bank's financial results."


The closure comes a year after chief executive Antony Jenkins announced the Transform project, which is reviewing every bank unit's performance and profitability.


"Barclays is exiting the majority of its global commodities business. The refocused business will provide a simplified financial flow platform for clients, with an emphasis on efficient electronic execution," the bank said in a statement.


"This decision is in line with Barclays' stated objective to actively evaluate and manage our businesses ensuring they meet strict economic and strategic criteria within the new regulatory environment."


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Source: City A.M. (UK)