Barclays confirmed this morning it will sell its Portuguese non-core assets – including its retail banking, wealth and investment businesses, as well as the small business arm of its corporate banking business – to Bankinter.
It will also sell its insurance business in the country to Bankinter's insurance subsidiary, which operates a joint venture with Mapfire.
But the bank said it will continue to operate its Barclaycard, investment banking and multinational corporate banking arms in the country.
Barclays added that although the transaction is likely to result in a decrease in risk-weighted assets of £1.7bn on completion, it expects to make a loss after tax of £200m, which will be booked in the third quarter of this year.
Some 1,000 employees in its Portuguese banking and insurance arms will be transferred to Bankinter, along with 84 branches.
John McFarlane, the bank's chairman, said it remained "on track to rebalance Barclays as part of our strategy to deliver sustainable returns".
Barclays' share price rose 1.6 per cent to 257.8p in early trading.