Barclays heads for bust-up with Sherborne's Bramson over trading arm

Bramson, whose 5.2% stake in Barclays was revealed in March, has sounded out other investors about targeting Barclays’ markets division, the Evening Standard said.

The New York-based investor believes shedding the capital-intensive business could free about £60bn of capital, strengthening Barclays’ balance sheet and releasing money for shareholder payouts.

Bramson’s plan, which would leave Barclays' investment bank as a capital-light advisory business, is at odds with the strategy of Barclays chief executive Jes Staley, who has pledged to improve the business's performance.

“There’s going to be a bust-up,” a source told the Standard. Bramson also wants to overhaul Barclays’ board, the paper reported. Bramson is said to have run his plans past investors before any approach to Barclays.

Barclays’ investment bank has swung in and out of favour since it was formed 30 years ago as BZW in the era of the City’s Big Bang. It boomed before the financial crisis and expanded with the acquisition of Lehman Brothers’ US business but has struggled to compete with bigger rivals after regulators imposed greater capital requirements on trading operations.

Staley’s predecessor, Antony Jenkins, tried to reduce Barclays’ reliance on investment banking but was forced out when the investment bank’s senior managers protested.