Barclays has a storied history in credit cards, ranging from being one of the first non-US bank card issuers to its global presence. With roots in London dating back to 1690, and strong presence across central Europe, the shift to Ireland is a significant sign of the world to come as the UK exits from the European Union.
- The move shows Barclays putting its Brexit contingency plans into action, in common with other banks which are not waiting for the outcome of negotiations over how financial services will operate after Britain leaves the EU in March.
- The British bank outlined plans to expand its EU-based Irish entity in a slide presentation to investors earlier this month, saying the unit would primarily consist of Barclays corporate, investment and private banking activities and its Barclaycard credit card business in Germany.
- In addition to the French, German, and Spanish branches, Barclays will ultimately move all of its European branches under control of Barclays Bank Ireland, one of the sources said.
Barclays is certainly not alone.
- Barclays rival HSBC (L) has begun shifting direct ownership of its European branches from its British entity to its French subsidiary, while Lloyds (LLOY.L) is planning three EU subsidiaries, Reuters reported in July.
Germans are not known for their love of credit, in fact, while 91% of Germans own debit cards, only 52% own credit card. It will be interesting to watch as the business unfolds.
Overview by Brian Riley, Director, Credit Advisory Service at Mercator Advisory Group