Barclays is ‘far along’ in discussions with SEC on securities selling error -CEO
NEW YORK — Barclays PLC is very “far along” in discussions with the U.S. Securities and Exchange Commission after it sold securities in breach of U.S. rules, the bank’s chief executive said on Monday.
“We are very, very far along in discussions with the SEC on resolving outstanding issues with that matter,” C.S. Venkatakrishnan told a Barclays investor conference.
Barclays’ second-quarter profit was dented by a 1.9 billion pound ($2.3 billion) hit for regulatory missteps, including having to buy back billions of dollars of securities the bank sold in error.
It took a charge of 1.3 billion pounds in the second quarter to cover the costs of buying back $17.6 billion of securities it sold in breach of U.S. regulations.
“That was a mistake that should not have happened, particularly disappointing because we had made a lot of progress and continue to make progress,” he said.
Venkatakrishnan said the macroeconomic environment in the United Kingdom is “challenging” because of higher inflation and energy prices.
Britain’s economy grew by less than expected in July, raising the risk that it is already in a recession.
With inflation at a 40-year high of more than 10%, gross domestic product expanded by 0.2% from June, official data showed on Monday, weaker than a median forecast of 0.4%.
Still, the Barclays CEO said UK consumer finances remain strong because of a robust labor market and government stimulus programs during the pandemic.
“Consumer balance sheets are strong because of both the support that they received during COVID and because people didn’t spend as much on certain high-ticket items, especially related to travel,” he said.
Credit quality remains solid in the UK despite its economic travails, and in the United States the bank sees few signs of financial stress among its clients, Venkatakrishnan said.
(Reporting by Lananh Nguyen and Saeed Azhar; Editing by Mark Porter)