Barclays share price subdued as bank sells precious metals storage

on May 16, 2016
Updated: Mar 11, 2020

Barclays (LON:BARC) has inked a deal to offload its precious metals storage business in the UK, the blue-chip lender has said. The move comes with the blue-chip bank looking to trim non-core assets as it looks to boost earnings.

Barclays’ share price has fallen into the red in today’s session, having shed 1.11 percent to 163.51p as of 14:31 BST. The shares are underperforming the broader London market, with the benchmark FTSE 100 index having lost 0.29 percent to stand at 6,120.84 points. The bank’s shares have lost more than 37 percent of their value over the past year, and are down by some 25 percent in the year-to-date.

Barclays announced in a statement today that it had agreed to sell its precious metals storage business in the UK, including its vaulting facility, to ICBC Standard Bank. The FTSE 100 group noted that neither party would be disclosing the financial terms of the deal. The vault, which has capacity to hold 2,000 tonnes of gold, has been operational since 2012.
“This sale represents further progress with our Non-Core rundown as we work to simplify Barclays’ operations and achieve our cost and capital reduction commitments,” John Mahon, Co-Head of Barclays Non-Core, commented in the statement.
The disposal comes after the bank announced its intended exit from precious metals in January 2016 and moved the business into Barclays Non-Core. A memo seen by Reuters earlier this year showed that the FTSE 100 group was exploring the sale of what remained of its global precious metals business, which had been cut back significantly in recent years.
Barclays is also currently looking to trim its stake in its Africa unit as it aims to focus on its UK and US markets. Earlier this month, the FTSE 100 group raised a little over £600 million after selling part of its stake in Barclays Africa through an accelerated bookbuild placing.
As of 15:07 BST, Monday, 16 May, Barclays share price is 164.00p.