BZW quits Japanese equities business

Barclays, the UK bank, is to close down its Japanese equities business after failing to find a suitable buyer, with the loss of around 100 jobs in Tokyo. Some staff covering Japanese sales desks in other Barclays' offices will also lose their jobs.

Martin Taylor, Barclays' chief executive, put large chunks of BZW, Barclays' investment banking arm, up for sale last month after the businesses failed to generate adequate returns. Mr Taylor originally intended to sell the businesses as a package, but was forced to adopt a piecemeal approach as potential purchasers dropped one by one out of the bidding race.

CSFB, eventually left as the sole bidder, bought the equities and corporate finance divisions earlier this month at a knockdown price. But the Swiss bank turned up its nose up Barclays' Asian and Australasian activities. The Japanese operation was dubbed "a loser" in a confidential video-conference for CSFB directors.

A spokesperson for Barclays said: "We have talked to number of potential purchasers [for the Japanese equities business] but were not able to come to a mutually satisfactory agreement".

The spokesperson denied that the decision was connected with recent turmoil in Far Eastern markets, saying: "We are happy with the way the Japanese equities business has fared."

Following the closure of the equities business, Barclays will be left with around 450 staff in Japan, 300 in Barclays Capital and 150 in Barclays Global Investors, its asset management arm.

Another 18 staff in other offices, including London, have also lost their jobs. A Barclays' spokesperson would not discuss details of redundancy packages, but said that all employees had been offered "terms commensurate with their contracts".

The former Barclays' employees will be battling in an increasingly competitive labour market for new jobs. Yesterday, Peregrine Investment Holdings, the Hong Kong-based bank, announced it was cutting 275 jobs world-wide.

Barclays said yesterday that the disposal of its remaining Asian equities businesses as well as the wholesale disposal of its Australasian activities were unaffected by yesterday's news. Analysts have expressed doubts that Barclays will be able to sell its Asian equities businesses as a package, pointing to concerns about the profitability of some of the operations. The City is more upbeat, however, about prospects for the bank's Australasian businesses.