BarCap will shed hundreds of jobs

The investment banking arm of Barclays is to cut hundreds of jobs in the UK because several months of slow activity across the industry looks set to continue next year.

"We have begun a consultation process to reduce headcount within Barclays Capital," a spokesman said, adding that it would "continue to hire across those parts of the business that are growing." He declined to say how many jobs would be cut.

BarCap blamed the market slowdown on its decision in August to cut about 400 back-office jobs in Asia, Europe and the US. Its rivals have also cut jobs and are expected to continue doing so while markets remain tough. Bob Diamond, the head of BarCap and CEO-elect of Barclays, has been conducting a review of returns across the bank.