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Another Bank Exiting the commodities business

 (Image source: theguardian.com)

As a result of stringent new regulations and shrink profits, Barclays PLC (LON:BARC) will largely pull out of its commodities business. Barclays and other big banks are now required to hold more capital against its trading activities in the commodities business. The costs associated with holding more capital exceeds the returns generated from the division. According to reports, the bank will terminate a sizable number of its commodities staff. Barclays is not alone leaving the commodities business. For example, JPMorgan Chase & Co. (NYSE:JPM) sold its physical commodities business. Moreover, Bank of America Corp (NYSE:BAC), Deutsche Bank AG (USA) (NYSE:DB), and Morgan Stanley (NYSE:MS) have all reduced their commodities operations.