New York would welcome Barclays Plc
Barclays is considering moving its headquarters from London to dodge British capital rules, which the bank sees as onerous, people familiar with the matter said.
New York City Mayor Michael Bloomberg said the city is not offering any special incentives for Barclays to relocate, but would be delighted to become its new home.
It would be a great move for them to move here, Bloomberg said at a press briefing. I hope they move here; it'd be great for us.
Barclays has said its preference is to stay in London, but Chairman Marcus Agius said in August that it and other banks had to consider where they were based as regulations shifted around the world. The sources told Reuters on Wednesday that was still the case.
The bank, which has been based in London for more than 300 years, could move to New York and has had preliminary conversations with U.S. regulatory officials on a move. It is conducting an analysis of whether switching its domicile makes sense, the Wall Street Journal said on Wednesday.
If Barclays did relocate its headquarters, it would create a loss of major tax revenue for London and a windfall for New York City, said Selwyn Blair-Ford, head of global regulatory policy at the consulting firm FRSGlobal in London.
Last year, Barclays paid 6.1 billion pounds ($9.8 billion) in global taxes, 2.8 billion pounds of which went to Britain, according to Barclays' annual report.
The latest speculation had been prompted by a report by analysts at UBS rather than by any major change internally, a person familiar with the matter said.
UBS analysts wrote in a note on Tuesday: While staff compensation is driven by international comparisons, rewards to shareholders look increasingly determined by local regulators. If this difference becomes permanent, we think Barclays has little option but to consider shifting domicile.
Barclays declined to comment.
Barclays Capital took over New York-based Lehman Brothers in 2008, so a move to the Big Apple would be a homecoming for some portions of the bank.
British banking regulators have indicated banks should hold core Tier 1 capital ratios of nearly 10 percent, above the 7 percent level dictated by global regulators.
The Independent Commission on Banking (ICB) is also considering forcing banks to separately capitalize their investment banks, which could cost banks billions of pounds in holding extra capital.
Barclays has considered moving before, and had planned to move its headquarters to Amsterdam as part of its unsuccessful attempt to buy Dutch bank ABN Amro four years ago.
It is not alone in considering whether to leave London now.
HSBC Holdings Plc
Rival Standard Chartered Plc
UBS analysts said Barclays' increasingly important overseas business and its growing American investment banking presence make it similar to Wall Street bank JPMorgan Chase & Co
While the Fed has signed JPM off to reinstate meaningful distributions to shareholders, Barclays remains mired in the fog of regulatory uncertainty, the note said.
If Barclays did move its headquarters to the United States, it could cost the company several hundreds of millions of pounds plus another 30 million pounds ($48 million) in preparatory work, the Journal said.
The ICB does not release its final report until September, and banks are not expected to make any decision before then.
In New York, it is not just the mayor who would love to see Barclays come to town.
Kathryn Wylde, president of the pro-business Partnership for New York City, said she is encouraged by the reports of Barclays' possible move as well. She noted that New York offers an incentive program, known as Excelsior, that includes tax credits for new job creation.
Barclays is a leading global institution that has already made a big investment in New York, Wylde said in a comment emailed to Reuters. Winning their headquarters would be a major plus for our status as a financial center.
The Empire State Development Corporation said it is aware of Barclays Capital's intentions and can understand why they and other global companies would consider relocating to the Financial Capital of the world, but declined to make any further comments.
The office of New York state Governor Andrew Cuomo did not immediately have a comment.
(Additional reporting by Lauren Tara LaCapra and Joan Gralla in New York and Sudip Kar-Gupta in London; Editing by Louise Heavens, Mike Nesbit and Gerald E. McCormick)