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New business model for Barclays

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Shares of the British bank Barclays PLC (ADR) (NYSE:BCS) are soaring this morning after the bank unveiled a plan to shrink itself. Over the next three years, the bank will slash 19,000 positions. In the current year alone, 14,000 positions will be eliminated. The investment banking arm of the bank will see 7,000 jobs cut by 2016, representing more than a quarter of the workforce within that division. In addition, the bank will create an internal “bad bank” housing risky assets and troubled businesses. The “bad bank” will seek to sell those divisions or reduced its risk exposure. Basically the bank is slimming down and narrowly its focus.