Intends to remove the risk that it might have to write down the value of the assets
In order to clean up its balance sheet and allay shareholder apprehensions over its investments, Barclays is contemplating to spin off a GBP4 billion portfolio of complex credit assets – reported The Financial Times.
Reportedly, the UK-based bank is planning to off-load the assets from its balance sheet in a similar manner it did last month with a GBP12.3 billion portfolio. The bank had set up a company called C12, took on the asset portfolio and code named Protium.
People familiar with the matter are also of the opinion that the bank may even go for divestment to a third party buyer, since collateralised loan obligations valuations have climbed in recent months.
One specialist credit manager said: “In August and September there has been a heavy rally. Prices for senior tranches of AAA credits have been selling for high-70s, low-80s cents in the dollar, compared to 60 or 70 a few months ago,” reported the news paper.