March, 10, 2010

Barclays has designated an internal team to assess possible targets and is looking for a franchise with a strong branch network and deposit base, the Wall Street Journal said. The bank is not in talks with any U.S. banks and no deals are imminent, it said, citing people close to the matter.Barclays declined to comment.Its shares were down 1.1 percent at 342 pence at 1000 GMT to value the business at 41 billion pounds ($61 billion), versus a flat FTSE 100 index."It would make sense, and if they do, it would make sense to do it in size," said Mike Trippitt, analyst at Oriel Securities.

"If ever there was a time to do it, this would be it.Analysts said there was a long list of candidates as the U.S. industry reshapes, and cited potential targets such as Fifth Third Bancorp, PNC Financial, and SunTrust Banks.A sizeable deal would likely require a capital raising but the benefit would be to attract retail deposits as regulatory reform increases pressure on balance sheets, and to provide distribution for its U.S. credit card products and growing BarCap investment banking business, analysts said.

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