'Mergers and IPOs restart: how Barclays wants to grow in Europe'

Speaking of IPOs, a number of European companies, including Italian ones, have in recent years decided to list on Wall Street, aiming for higher valuation multiples. There is also talk of giants such as the French Total, which may prefer New York to Paris. Do you think this is a transitory phenomenon? And how do you explain it?

When a company has an international profile, it is logical that it decides to list where it believes it has the most advantages. Not only in terms of ease of raising capital, but also in terms of market liquidity and research by analysts specialised in the various sectors. But it is a phenomenon that does not only affect Europe, even China's Alibaba ten years ago decided to list on Wall Street. The US is the largest financial market in the world.

For Europe to try to compete with the US, do we need a single capital market?

In my opinion it is a necessity, not an option to be considered. In the coming years, hundreds of billions will have to be invested in Europe for the energy and digital transition. It is impossible to think of financing this only through banks or states: it is essential to create an effective single capital market. But to achieve this, it will not be enough to act only on the supply side, it will also be necessary to incentivise share buyers by channelling the savings - including pension savings - of Europeans into equity.

Do we also need European champions to compete in the various sectors with the US and Chinese giants?

I realise it is not easy, but Europe needs a shared industrial policy. The automotive sector is undergoing an epochal transformation and the Chinese challenge on the electric car is now concrete. We believe that in the automotive sector in Europe there will be further consolidation, the size scale is crucial.

A few days ago French President Macron opened up to cross-border bank mergers in Europe. Do you think that political will is enough or do you need the completion of the Banking Union first?

The European Banking Union and common deposit insurance are crucial. But cross-border mergers between banks depend on two elements: the economic logic and the social environment. Cost synergies in cross-border operations are modest or difficult to realise. For now, we consider domestic reorganisation, as we are seeing in Spain, more likely.

Regarding the attempted takeover of Banco Sabadell by Bbva, do you think we will see more hostile takeover bids in Europe?

No, I don't see this as a specific trend. Rather, I think it is part of a more general upswing in M&A deals, of which hostile takeovers are a part. But these are difficult deals because it is not enough to convince just the shareholders but all the stakeholders.

The last two years have seen a flurry of share buy backs in Europe. Do you think this trend will continue or will capital be diverted to external growth?

Acquisitions make sense but then carry execution risks because synergies are not always so easy to realise. I believe that buy backs, along with dividends, will continue. Especially in those sectors, such as banking, where for years shareholders have on average received little remuneration.

In the context you have outlined, what strategy does the Barclays Group have?

Group targets were presented in February in the new three-year business plan 2024-2026. The financial targets are clear: Roe above 12%, £10 billion distribution between dividends and buy backs, investment banking Rwa below 50%. The logic of the plan is summarised in three qualitative targets: simpler, better, more balanced.

Barclays has remained the only major European bank to have a strong presence in the US. Is this an advantage for your business with European customers?

We consider ourselves the most American of European banks and the most European of Anglo-Saxon banks. Having direct access to the US market, which is the largest in the world, is a clear advantage for our customers in Europe. The goal is to grow further in Italy, which we continue to consider an interesting market, by deepening the relationship with our clients with a greater interchange of corporate and investment banking services.