Barclays PLC is considering a bid for Societe Generale’s UK private bank, signaling its ambition to broaden its business. According to a Reuters report, the British bank is in the early stages of evaluating an offer for the acquisition.
On Feb 20, Barclays will unveil a new group strategy designed to streamline its business model and foster sustainable returns with reduced risk. The potential bid for SocGen’s British private bank aligns with this strategic initiative.
Barclays’ interest in SocGen’s private bank was spurred after the bank announced its agreement to acquire Tesco’s retail banking business for £600 million. This partnership, a major milestone for Barclays, not only offers an opportunity to bolster its retail banking ambitions but also signifies a new chapter in expanding its customer base and distribution channels.
The Tesco deal is anticipated to complement Barclays UK’s existing business and fortify its position in the market by leveraging Tesco’s extensive distribution channels and customer loyalty scheme.
Societe Generale has commenced the process of inviting bidders to participate in an auction for its Kleinwort Hambros unit, which managed over £12 billion in assets under management in 2022 and could fetch up to £700 million in a sale.
Aside from Barclays, Lloyds Banking Group plc, Rathbones, and Raymond James have been invited to bid. However, Rathbones has decided not to participate in the process.
As SocGen looks to divest businesses in a strategic overhaul, it is preparing to sell its private banking operations in Switzerland.
While discussions are still at a preliminary stage, there is no certainty that a deal will materialize.
Over the past three months, Barclays’ shares have gained 2.4%, slightly trailing the industry’s 3.5% rally.
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Currently, BCS carries a Zacks Rank #3 (Hold). Find the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Inorganic Growth Efforts by Other Banks
Webster Financial Corporation recently completed the acquisition of Ametros Financial Corp, a move aimed at expanding its financial services portfolio. Ametros, one of the country’s largest professional administrators of medical insurance claim settlements, will continue its operations under the Ametros and CareGuard brands.
The acquisition positions Webster Financial Corporation to tap into Ametros’ rapidly growing source of low-cost, long-duration deposits. It not only diversifies its deposit base but also introduces a new stream of non-interest income. With plans for full integration in the first quarter of 2024, this strategic move underlines the company’s commitment to expansion.
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Barclays PLC (BCS) : Free Stock Analysis Report
Societe Generale Group (SCGLY) : Free Stock Analysis Report
Webster Financial Corporation (WBS) : Free Stock Analysis Report
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