Sunday, February 10, 2013

Barclays to close tax unit

From The Sunday Telegraph -

Barclays is to close its controversial tax avoidance unit as one of the landmark measures of Antony Jenkins’ much anticipated strategy review designed to show that “Barclays is changing”.

Chief executive of Barclays global retail banking, Antony Jenkins

"The Sunday Telegraph can reveal that Mr Jenkins, who will deliver the outcome of the review on Tuesday, will say the bank will shut its structured capital markets (SCM) business.
In the mid-2000s the unit made profits of as much as £1bn in a single year and became synonymous with Barclays’ aggressive investment banking culture under the stewardship of Bob Diamond, Mr Jenkins’ predecessor as chief executive.
The unit, previously run by Barclays’ highest-paid banker, Roger Jenkins, who was paid as much as £40m a year as a result of SCM’s success, gave advice to large companies on how to avoid tax. SCM was responsible for building a network of almost 300 offshore tax-haven subsidiaries which meant Barclays itself paid only £113m of UK corporation tax in 2009, despite profits of £4.6bn.
The strategy review will be delivered at London’s Royal Horticultural Halls just hours after the bank’s full-year results for 2012, which are expected to show that Barclays will have made adjusted profits of £7.18bn, up from £5.88bn in 2011.
The review has seen Barclays split into 75 business units, each of which has been measured on the returns generated and the reputational impact of the specific activities."
Maybe other big banks and consultancies offering Tax Avoidance services will also close. Maybe pigs will fly!

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