Barclays Chief Executive Officer C.S. Venkatakrishnan said on Tuesday that he expects a revival of deals in the next months, as the market conditions improve and the valuation gaps narrow. He was speaking at an investment conference hosted by the bank in New York.
Stable markets and attractive lending terms
Venkatakrishnan said that the recent stability in the financial markets, coupled with the availability of bank lending in terms attractive to investors, have created a favorable environment for deal-making. He said that the bank has seen a strong pipeline of potential transactions across sectors and regions.
He also said that the valuation corrections that have occurred over the last months have helped to bridge the gap between buyers and sellers, which was one of the main obstacles for deal activity in the previous quarters. He said that the bank is well-positioned to capitalize on the opportunities in the market, given its diversified and balanced portfolio of businesses.
Strong performance in investment banking
Barclays reported a strong performance in its investment banking division in the first half of 2023, despite the challenging market conditions. The division posted a 14% increase in income, driven by higher revenues from equities, fixed income, currencies and commodities (FICC), and banking. The division also increased its market share in key areas such as debt capital markets, equity capital markets, and mergers and acquisitions.
Venkatakrishnan said that the bank has invested in its investment banking franchise over the years, and has built a strong and resilient platform that can deliver consistent results across cycles. He said that the bank has also focused on enhancing its client relationships, improving its risk management, and optimizing its capital allocation.
Outlook for the second half of 2023
Venkatakrishnan said that he is optimistic about the outlook for the second half of 2023, as he expects the global economy to continue to recover from the impact of the COVID-19 pandemic. He said that the bank is well-prepared to navigate any potential challenges or uncertainties that may arise, and to support its clients and stakeholders.
He also said that the bank remains committed to delivering on its strategic priorities, which include growing its core businesses, improving its profitability and efficiency, strengthening its balance sheet and capital position, and returning excess capital to shareholders.