Barclays buys ING's savings business
BARCLAYS’ NEW chief executive set the course firmly towards retail banking yesterday with his first deal since replacing Bob Diamond – the takeover of ING’s British savings and loan business and its 1.5 million customers.
Antony Jenkins, previously head of Barclays’ retail banking operations, took the top job at the end of August after the Libor interest rate rigging scandal forced Mr Diamond, an investment banker, to resign.
ING said in August it wanted to quit Britain, part of plans to divest assets to repay Dutch state aid. It will effectively pay Barclays to take its ING Direct UK business, including £10.9 billion of deposits and £5.6 billion of mortgages.
Mr Jenkins had already signalled his intention of focusing more on retail banking and less on riskier investment banking. Barclays will buy the loans at a 3 per cent discount to their face value, leaving ING with a €320 million loss on the transaction after tax.
“To the extent that this deal signals CEO Antony Jenkins’ revised strategic intentions and lower dependence on the investment bank, we view it as positive,” said Vivek Raja, analyst at Oriel Securities. – (Reuters)