Barclays Spain is healthier than it was six months ago. The Spanish subsidiary of the British banking titan has made great efforts to heal itself and raised a total of 299 million pounds (around 342 million euros) to achieve this objective.
According to figures provided by Barclays yesterday, this much in cutbacks is close to 45% of the cost designated to cleaning up the Spanish subsidiary. Firm sources also indicated that the spending adjustment is principally focused on corporate banking.
For the past two quarters, the Spanish subsidiary has parted with 129 million pounds (around 150 million euros) from an adjustment that occurred when a hundred offices were closed and headcount was trimmed by nearly 700 employees. As stabilization nears, we also must remember that in April the Barclays head office fed around 1.3 billion euros to the subsidiary so that it could meet capital requirements set by the Bank of Spain.
The figure, which is smaller than what was considered initially and noted by elEconomista on March 9, was owed in part to the fact that headcount reductions were not part of previous predictions.
This operation was carried out through two transactions: first, a capital expansion greater than 700 million euros by means of which credits were paid against the head office, and second was done at a total cost of 600 million euros with preferred subscription rights.
But these events are hardly impacting Barclays' profits in the first half of the year, which have suffered losses of nearly 33% due to provisions facing compensations for bad mortgage-backed security payments.
