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Barclays to pull out of Korean market

January 20, 2016

By Kim Jae-won

British banking group Barclays will close its Seoul office as part of its global slimming down strategy, an official from the financial regulator said Wednesday.

A director at the Financial Supervisory Service (FSS) said Barclays told the authorities of its plan to close its banking and securities business in Korea.

“Barclays plans to pull out of the Korean market,” said the director, asking not to be named.

Foreign banks have been withdrawing from the local market, or downsizing, as part of their global strategy to exit non-core businesses. Last month, U.S. banking giant Citigroup signed an agreement with Apro Service Group to sell its consumer finance subsidiary in the country, Citigroup Capital Korea.

Barclays confirmed that it is looking for business chances in other countries, but said no firm decisions have been made.

“We are constantly monitoring our opportunities in different geographies and businesses over the cycle,” Barclays said. “If any firm decisions are made, we will provide an update.”

In December, Barclays said it had agreed to sell its Italian retail banking network of 89 branches, including a broadly balanced portfolio of assets and liabilities, to CheBanca!, a member of the Mediobanca Group.

“This transaction is further evidence of the reshaping of Barclays Group to focus on our core businesses,” said Barclays Group CEO Jes Staley. “We continue to make progress in the reduction of Barclays non-core assets as we target risk-weighted assets of around 20 billion pounds at the end of 2017.”

According to Barclays, its rundown of non-core businesses continued last year, with risk-weighted assets (RWAs) decreasing to 55 billion pounds in September from 57 billion pounds in June.

The U.K. banking group said its announced sale of the Portuguese retail business in the third quarter last year, which will be completed in the first quarter this year, is expected to result in a further 1.7 billion pounds reduction in non-core RWAs.

Barclays reported 4 percent growth in the group’s adjusted profit before tax to 5.2 billion pounds for the first three quarters of 2015 from the previous year, reflecting improvements in all core operating businesses. Its adjusted return on average shareholder equity also increased to 7.1 percent during the period.