Barclays is to pay €237 million to an Italian bank to offload Barclays’ branches in Italy.
Che Banca!, a subsidiary of Mediobanca Group, will take over the 89 branches and 220,000 customers. Its plan is to integrate them into its existing network.
Barclays is in its continued process of cutting down its operations in Europe. It sold its Portuguese retail and small business banking arm in August and last year sold its Spanish operation.
Barclays' Italian retail operations were likely to be the next to go as the bank shifts its focus to the more profitable credit card and investment banking operations in these countries.
Its Italian set-up is understood not to be making profit currently. Che Banca! is hoping that by cutting costs, it can eventually make it profitable.
CheBanca! boss GianLuca Sichel said the acquisition of 220,000 affluent clients would otherwise “have taken longer and a lot more money”. Moreover, it was actually being paid by the business owner to acquire the assets.
Barclays said that despite the sale it would continue to manage its Italian mortgage portfolio, worth €2.89 billion.
The new CEO of Britain’s third largest bank, Jes Staley, cited the sale as further evidence of Barclays Group’s return to what it deems its “core business”.
