Continuing restructuring moves, Barclays (BCS) plans to set up a bad bank to hold units designated as part of its "exit quadrant," reports Bloomberg, and has chosen co-chief of the corporate and investment bank Eric Bommensath lead the unit. Currently serving alongside Bommensath as co-head of the investment bank, Eric King will take over as sole leader. Among the businesses in the bad bank will be the commodities division.
Noting a number lenders have set up these bad banks in the hopes investors will look past non-core assets, analyst Simon Maughan, reminds most "are not fooled by this."
Barclays management - recently rewarded with large bonuses amid sliding profits - is under pressure to do something to earn its keep, and is set to unveil a strategy for the investment bank on May 8. Yesterday, it announced its U.S. chief Skip McGee was stepping down, effective today.