When developing our strategy in March 2016, the management team of Barclays considered four major changes that will transform the banking landscape.
• Firstly – the re-regulation of banks following the financial crisis of 2008, which has included new minimum levels of capital which banks are required to hold against assets on balance sheets, and the maximum leverage banks can use. New UK regulation also requires that retail banking (individual and small business banking) is “ring-fenced” from wholesale banking.
• As a consequence of re-regulation, the cost of borrowing from bank balance sheets has led to a shift of corporate lending towards capital markets. As a result, the role and size of capital markets in supporting economic growth have grown significantly in the last decade and are set to continue. Scale, breadth and market share are critical to successfully accessing those capital markets, which are centred in New York and London, where we are located.
• Third – the rapid digitisation of banking is fundamentally transforming how we serve every customer and client from personal banking right through to the largest institutions. Success requires deep investment, strategic partnerships with technology providers, and protection of intellectual property to maintain a competitive advantage.
• Fourth – the acceleration in payments technology and the ability to move money for businesses and people faster with lower friction and cost. As all forms of transaction are digitised, the technology and innovation enabling those transactions are an increasingly critical part of a bank’s capability.
With 328 years’ experience Barclays has a very strong history as retail bank and a lender to business. Over the last 50 years, with the creation and development of Barclaycard, we have built a market-leading payments business. And in the last 20 years we have developed a strong UK, European and US investment banking franchise. Our strategy is designed to build on those successful assets to meet the needs of our customers and clients, compete in a changing environment, and deliver for shareholders.