Mediobanca gets Barclays to pay for its own pivot

The sale is part of plans by Britain’s third biggest bank to shed continental European retail banking operations as it retreats from businesses that are unprofitable or lack scale.

The British bank added that it is also selling off a “broadly balanced portfolio of assets and liabilities” to the group.

It also includes 220,000 clients and residential mortgage loans totaling €2.9bn, with no non-performing items and aligned with CheBanca! quality standards.

With the Barclays deal, CheBanca!, founded in 2008 and focused on digital-savvy customers with between 50,000 and 200,000 euros, will almost triple its number of branches and its client numbers will grow by 60 percent to 770,000.

Barclays is about to offload its Italian retail banking operations, the company announced today.

One of the sources said Barclays will pay less than 250 million euros (£177.32 million) to help refinance the business. It had £13.5bn of Italian residential mortgages at the start of the year.

It will continue to operate investment banking and corporate banking in Italy, and manage the remaining retail mortgage portfolio.

The latest slimming effort follows the bank’s sale of its Portuguese retail and small business banking arm in August and prior to that, its Spanish banking operations to CaixaBank previous year.

“This transaction is further evidence of the re-shaping of Barclays Group to focus on our core businesses”, said Jes Staley, the bank’s new chief executive. The bank is trying to reduce its “non-core’ assets, or businesses it no longer wants, to about 20 billion pounds by the end of 2017, from 55 billion pounds at the end of September”.

The deal is subject to regulatory approval and investors expect to hear the result in the second quarter next year.