Barclays considering Dublin as its European headquarters

Barclays has said it is considering making Dublin the headquarters of its European business as a result of Britain's decision to leave the European Union.

The bank's chief executive, Jes Staley, told the BBC on Thursday that while Barclays remained committed to London, it was also considering adding hundreds of staff to offices in a number of European cities, including Dublin, Frankfurt and Milan.

The news came as Bloomberg reported that Morgan Stanley is actively scouting office space in Dublin and Frankfurt.

Shares in Barclays rose by nearly 3 per cent in early trading on Thursday after it reported a jump in profits for 2016 to £3.2 billion (€3.8 billion), versus £1.1billion a year earlier. This was below the average forecast of £3.97 billion from analysts’ estimates compiled by the bank.

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“We are looking at contingencies right now. We have a subsidiary bank in Ireland, we have a very large operation in Germany – we are the largest credit card business in Germany. So we are looking at what our options are to operate across Europe if we lose the single market because of Brexit,” he said in an interview with the BBC.

Mr Staley said he expected the majority of staff to remain in London, but added that changes to the bank’s legal structure, including making Dublin the headquarters of its European business, might be necessary.

Core operations

“We may add some people in Dublin. We may add some people across Europe but our core operations and centre will continue to be London,” Mr Staley added.

Barclays reported a surprise increase in its core capital ratio on Thursday, as the bank took advantage of its rising profits to put money aside for expected demands on its cash from legal issues and worsening global market conditions.

The bank’s capital ratio, a key measure of financial strength, rose to 12.4 per cent against analysts’ expectations it would only reach 11.8 per cent.

Barclays said the capital boost came from increased profits as the group neared the end of a major restructuring.

The bank said it would close its non-core division that holds its assets earmarked for sale in June six months earlier than expected.

It also said it had reached an agreement with its African division on the terms of their separation that will see it pay Barclays Africa 12.8 billion rand (€940 million) to fund investments required to separate the two.

Separately, Bloomberg reported on Thursday that Morgan Stanley is scouting for office space in Dublin and Frankfurt. The report indicates the bank may initially move about 300 workers to one of the cities. – (Additional reporting, agencies)