Barclays seen on lookout for U.S. bank

The British bank's shares dipped 2 percent on Wednesday after the Wall Street Journal (WSJ) said the bank had an internal team assessing possible targets and is looking for a franchise with a strong branch network and deposit base.

The bank, led by Chief Executive John Varley since 2004, is emerging as one of the winners from the financial crisis and has long looked at "opportunistic" deals, and analysts and bankers said a U.S. deal could make sense.

It is not in talks with any U.S. banks and no deals are imminent, the WSJ said, citing people close to the matter.

Barclays declined to comment.

"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 PNC Financial, SunTrust Banks and Fifth Third Bancorp.

They are valued at between $10 billion (6.7 billion pounds) and $30 billion, and analysts said other targets could include Bancorp, which has a market value of about $48 billion, or Comerica, a Dallas-based bank valued at $5 billion.

Barclays shares were down 0.95 percent at 342.5 pence at 1:20 p.m. to value the business at about 41 billion pounds ($61 billion), underperforming a flat European bank sector.

A sizeable deal would likely require a capital raising but attract retail deposits as regulatory reform increases pressure on balance sheets and would be seen as positive, as would distribution for its U.S. credit card products and growing Barclays Capital investment banking business, analysts said.