WEBVTT - Barclays CEO C.S. Venkatakrishnan Talks Deregulation 

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio news.

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<v Speaker 2>Let's turn our attention to another big bank, Barclays's reporting numbers,

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<v Speaker 2>the first of the major UK banks to drop its

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<v Speaker 2>numbers onto our screens. Let's talk about the numbers before

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<v Speaker 2>we get to Venkat Investment Bank revenue for the fourth

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<v Speaker 2>quarter two point sixty one billion, that is ahead of estimates.

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<v Speaker 2>Pre tax profits also higher than expected at one point

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<v Speaker 2>sixty six billion. The bank has announced a further share

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<v Speaker 2>buy backs, but a share buy back this morning ces

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<v Speaker 2>n Kata Christian joining us now at the Barclays CEO,

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<v Speaker 2>always the pleasure of Vencak. Good morning. The numbers are

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<v Speaker 2>better than anticipated this time last year. You announced new targets,

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<v Speaker 2>you announced new returns to shareholders. He gave the banker boost.

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<v Speaker 2>Are you ahead with this set of numbers one year

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<v Speaker 2>on the way you thought you would be?

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<v Speaker 3>Look, I'm very happy with the results we have demonstrated.

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<v Speaker 3>If you look at our profits this year for twenty

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<v Speaker 3>twenty four, it's eight point one billion pounds. It's twenty

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<v Speaker 3>four percent ahead of the numbers for twenty three. It's

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<v Speaker 3>based on a six percent growth in revenue, one percent

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<v Speaker 3>reduction in cost holding impairments flat. If you look more

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<v Speaker 3>broadly at what we laid out in that three year

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<v Speaker 3>plan to which you referred, you know, are rote this

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<v Speaker 3>year we guide it to greater than ten percent. We

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<v Speaker 3>printed ten point five percent. We announced that greater than

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<v Speaker 3>ten billion pounds worth of share buybacks and dividends over

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<v Speaker 3>the next three years twenty four to twenty five, twenty six.

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<v Speaker 3>And with this share buyback we announced today we've done

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<v Speaker 3>three billion for this year and we are rebalancing the

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<v Speaker 3>bank we are. You know, we've deployed about thirteen billion

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<v Speaker 3>pounds of order WA's into our UK facing businesses. That's

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<v Speaker 3>about it's more than a third of the thirty billion

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<v Speaker 3>we've planned. And the Investment Bank, which was fifty eight

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<v Speaker 3>percent of the bank in order Wa terms a year ago,

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<v Speaker 3>is now fifty six on its way to fifty which

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<v Speaker 3>is our target. So so far, so.

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<v Speaker 1>Good, Vick.

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<v Speaker 2>We've just been having a conversation with Betina Rollo, the

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<v Speaker 2>CEO of Comets Bank. She's targeting on rite returnal tangible

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<v Speaker 2>equacy of fifteen percent by twenty twenty eight. Do you

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<v Speaker 2>think Barclays could achieve some number similar to that? How

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<v Speaker 2>high could that figure go? You've got unicredits in the

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<v Speaker 2>kind of in the high teens. Now, does Barclays have

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<v Speaker 2>work to do on that number?

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<v Speaker 3>Well, we already have businesses that are performing well above that.

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<v Speaker 3>So if you look at the announcement today, our Barclay's

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<v Speaker 3>UK business has produced twenty three percent our ote for

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<v Speaker 3>the last year. Our UK corporate bank is in the

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<v Speaker 3>mid teens, I think sixteen percent. Our private banking and

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<v Speaker 3>wealth isn't the high twenties. It all depends on the mix,

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<v Speaker 3>and we are shifting the bank in terms of mix

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<v Speaker 3>to the higher returning businesses. We've also said that we've

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<v Speaker 3>put out a plan till twenty twenty six. Twenty twenty

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<v Speaker 3>six is not an end date, it's a point in

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<v Speaker 3>time and we'll look forward from there.

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<v Speaker 4>We had it's creedy in London. Talk to us a

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<v Speaker 4>little bit about your trading revenue here. I mean, it's

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<v Speaker 4>not a secret that all the banks on both sides

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<v Speaker 4>of the Atlantic have gotten a little bit of a

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<v Speaker 4>boost driven by the volatility from the Trump administration. How

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<v Speaker 4>long do you expect that to last as we start

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<v Speaker 4>to see a little bit more complacency creeping into these markets.

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<v Speaker 3>Yeah, Well, the markets, as you said, Kritie have been

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<v Speaker 3>quite volatile towards the fourth quarter of last year, which

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<v Speaker 3>we've reported, and it's stretched into the first quarter of

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<v Speaker 3>this year. It gives opportunities for our equity businesses. Where

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<v Speaker 3>I'm standing on the equity floor, and our equity business

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<v Speaker 3>over twenty twenty four was an outperformer, as was our

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<v Speaker 3>securitised products business, and we've been gaining market share with clients.

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<v Speaker 3>Those are the structural things I look for, and it's

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<v Speaker 3>a structural performance we try to create, and then we'll

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<v Speaker 3>take advantage of cyclical factors as and when they come.

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<v Speaker 3>But our plan is based on a very conservative estimate

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<v Speaker 3>of what the market wallet will be.

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<v Speaker 4>Let's stick with the Trump theme, perhaps from a different

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<v Speaker 4>angle here. There's a big expectation in these markets and

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<v Speaker 4>in these banks that the deregulatory agenda from the United

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<v Speaker 4>States is going to have a spillover effect into Europe

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<v Speaker 4>and into the UK, even pushing some of the regulators

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<v Speaker 4>on this side of the pond into loosening some of

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<v Speaker 4>those strings. How are you thinking about that? Is that

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<v Speaker 4>spillover effects something you're seeing tangibly in the first few

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<v Speaker 4>days of Donald Trump.

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<v Speaker 3>So the regulatory agenda in the US has been pretty

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<v Speaker 3>well signaled by President Trump before he came into office,

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<v Speaker 3>and it started to be enacted in the UK and Europe.

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<v Speaker 3>You're already seeing in the UK examples of the government

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<v Speaker 3>taking the line towards a more fairly balanced regulatory profile.

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<v Speaker 3>They've spoken about in the UK the Competition and Markets

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<v Speaker 3>Authority and what's called the Financial Ombudsman Service. I expect

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<v Speaker 3>that you will see some rebalancing, but you know, I

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<v Speaker 3>should say that we want the rebalancing in the context

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<v Speaker 3>of strongly regulated markets. We think all the major banks

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<v Speaker 3>as included good our advocates of a well regulated financial system.

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<v Speaker 3>It's what makes London great, and so there should be

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<v Speaker 3>some rebalancing. But in the context of a well regulated

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<v Speaker 3>financial system.

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<v Speaker 1>Good morning to Banka. Sticking with the theme of what

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<v Speaker 1>changes in the United States might bring, there's been a

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<v Speaker 1>lot of expectation going into another Trump administration that perhaps

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<v Speaker 1>we get more M and A, that the animal spirits argument.

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<v Speaker 1>But then there's also a lot of uncertainty what the

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<v Speaker 1>conversations around M and A look like.

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<v Speaker 3>To you, yeah, I think you're absolutely right. There's a

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<v Speaker 3>balance that's going on. On the one hand, what you've

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<v Speaker 3>got is deregulation, which allows companies to think more confidently

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<v Speaker 3>about whether the choices that they make will indeed be

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<v Speaker 3>permitted by the government. Then you still have a relative

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<v Speaker 3>stability in financial markets, both in interest rates and in

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<v Speaker 3>credit spreads. And then lastly, though, you've got tariffs, which

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<v Speaker 3>introduces questions regarding particular countries in particular industries. So I

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<v Speaker 3>think companies are going to have to balance the three

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<v Speaker 3>and over time we will get a clearer picture. It's

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<v Speaker 3>too soon to tell, too soon.

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<v Speaker 1>To sell on that one. Let me ask you, Christy

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<v Speaker 1>was asking you about trading revenues. You talked in glowing

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<v Speaker 1>terms about the equities team. I wonder what comments you

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<v Speaker 1>have on FICK revenues this morning. I see that for

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<v Speaker 1>the fourth quarter the number came in a little below

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<v Speaker 1>what some of the analysts were looking for. Is there

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<v Speaker 1>any explanation you can reach for their venct.

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<v Speaker 3>Look, the fixed income is the great strength of Barclays.

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<v Speaker 3>It's you know, the house of Barclays was built on

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<v Speaker 3>fixed income. We had a weaker start at the start

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<v Speaker 3>of the year, but especially in our European rates and

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<v Speaker 3>our macro businesses, it's been picking up through the year

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<v Speaker 3>and into the fourth quarter. Our securitized products business in

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<v Speaker 3>the US has been particularly strong, so I'm very confident

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<v Speaker 3>about fixed income performance going forward.

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<v Speaker 1>Okay, confident about the performance. Thank you very much, Benkat,

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<v Speaker 1>thank you for joining US. Barkley CEOCSN Category Nan with

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<v Speaker 1>us to talk about those results this morning.