LONDON & NEW YORK--(BUSINESS WIRE)--Barclays PLC ("Barclays") and Blackstone Credit & Insurance (“Blackstone”) today announced that Barclays Bank Delaware ("BBDE") has entered into an agreement with insurance accounts managed by Blackstone’s Asset Based Finance group, to sell approximately US$1.1 billion of currently outstanding credit card receivables (the “Transaction”) in relation to a defined set of Barclays-branded credit card accounts in the United States of America (the “Accounts”). This is the first in a series of activities Barclays plans to conduct to reduce its risk-weighted assets (RWAs) and create additional lending capacity for BBDE.
As part of the Transaction, BBDE will enter into a long-term strategic forward flow sale and servicing arrangement with Blackstone related to the Accounts. Blackstone’s investment will be made entirely on behalf of the firm’s insurance clients.
The Transaction remains subject to certain conditions and is expected to fund in Q1 2024.
Under the terms of the Transaction, BBDE will retain legal title in respect of the Accounts and BBDE will continue to service the Accounts for a fee. Barclays Bank PLC will invest into the Transaction alongside Blackstone’s insurance accounts.
The Transaction is expected to release approximately GBP£1.0 billion of RWAs on a post internal ratings-based (IRB) approach basis at the Barclays Group consolidated level(1). BBDE intends to use the proceeds of the sale to fund its lending activities.
Barclays Bank PLC, acting through its Investment Bank, served as exclusive structuring advisor to Blackstone in the transaction, to which it also served as risk retainer and liquidity facility provider.
Anna Cross, Group Finance Director at Barclays, said: “During our Investor Update, we said that we would leverage strategic partnerships to execute risk transfer agreements to reduce capital requirements. I am delighted to announce this first agreement in our US cards book.”
“We’re pleased to partner with an industry leader like Blackstone on this transaction that will help fund lending activities and support the long-term growth ambitions for our US Consumer Bank,” said Denny Nealon, CEO of Barclays US Consumer Bank and BBDE. “BBDE will continue to service the accounts, providing cardmembers with the high-level of service they have come to expect.”
Robert Horn, Global Head of Infrastructure & Asset Based Credit at Blackstone, said: “This collaboration demonstrates how we are supporting leading financial institutions with large-scale, long-term, efficient capital solutions in the asset based finance markets. Barclays has a premiere franchise in structured products and consumer banking and we look forward to working with them in the coming years to grow the partnership.”
(1) Subject to notification to and possible review by the Prudential Regulation Authority; the term “Barclays Group” refers to Barclays PLC together with its subsidiaries.
About Barclays
Our vision is to be the UK-centred leader in global finance. We are a diversified bank with comprehensive UK consumer, corporate and wealth and private banking franchises, a leading investment bank and a strong, specialist US consumer bank. Through these five divisions, we are working together for a better financial future for our customers, clients and communities. For further information about Barclays, please visit our website home.barclays
About Blackstone
Blackstone is the world’s largest alternative asset manager. We seek to deliver compelling returns for institutional and individual investors by strengthening the companies in which we invest. Our more than $1 trillion in assets under management include global investment strategies focused on real estate, private equity, infrastructure, life sciences, growth equity, credit, real assets, secondaries and hedge funds. Further information is available at www.blackstone.com. Follow @blackstone on LinkedIn, X (Twitter), and Instagram.
Forward-looking statements
This announcement contains certain forward-looking statements within the meaning of Section 21E of the US Securities Exchange Act of 1934, as amended, and Section 27A of the US Securities Act of 1933, as amended, with respect to the Barclays Group. Barclays cautions readers that no forward-looking statement is a guarantee of future performance and that actual results or other financial condition or performance measures could differ materially from those contained in the forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements sometimes use words such as ‘may’, ‘will’, ‘seek’, ‘continue’, ‘aim’, ‘anticipate’, ‘target’, ‘projected’, ‘expect’, ‘estimate’, ‘intend’, ‘plan’, ‘goal’, ‘believe’, ‘achieve’ or other words of similar meaning. Forward-looking statements are based on the current beliefs and expectations of Barclays’ directors, officers and employees and are subject to significant risks and uncertainties. Actual outcomes may differ materially from those expressed in the forward-looking statements. In setting its targets and outlook for the period 2024-2026, Barclays has made certain assumptions about the macro-economic environment, including, without limitation, inflation, interest and unemployment rates, the different markets and competitive conditions in which Barclays operates, and its ability to grow certain businesses and achieve costs savings and other structural actions. Additional risks and factors which may impact the Barclays Group’s future financial condition and performance are identified in Barclays PLC’s filings with the US Securities Exchange Commission (“SEC”) (including, without limitation, Barclays PLC’s Annual Report on Form 20-F for the financial year ended 31 December 2023 which is available on the SEC’s website at www.sec.gov). Subject to Barclays’ obligations under the applicable laws and regulations of any relevant jurisdiction (including, without limitation, the UK and the US), in relation to disclosure and ongoing information, Barclays undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
