How is BarCap like Goldman Sachs? Itâs not the set up for a gag. They both, on the face of it, are survivors of the credit trauma. But their latest numbers reflect that even those who have come through the credit crash with just minor cuts and bruising are finding times ever tougher. Thankfully John Kemp, from Sempra Metals, is back from his break to draw our attention to this. Barclays Capital, he notes, increased its appetite for trading risk despite the turbulent conditions in the second half. The bankâs gross value at risk rose 19 per cent on the first six months of the year, and the bank showed increased appetite for commodity risk. BarCap is up there with Goldman and Morgan Stanley in the big league for commodities trading. In fact, Bob Diamond said on Tuesday on the analyst call, Barclays believes its passed Goldman this year in commodities trading to nab the number two spot behind Morgan Stanley. It also sees the business as a major beneficiary of the tie-up with China Development Bank. But says Kemp: there are signs the bankâs trading operations are becoming less efficient, in the sense that the bank is having to take larger amounts of risk to generate the same or slightly higher revenues. BarCapâs net trading income rose 5 per cent to £3.7bn last year. But its net VaR, after diversification effects, rose 13.2 per cent, while the gross figures was up 20.3 per cent. The WSJ reports that Lehmanâs latest quarter may be the bankâs rockiest since the credit squeeze began. Even those that have impressed in their ability to skip through the credit mines are finding it ever tougher to navigate the tough markets. Kemp adds that Barclays has followed Goldmanâs Q4 in exhibiting signs that its trading operations are becoming less efficient: âIncome per unit of VaR is falling as trading conditions become more challenging.â Source : http://ftalphaville.ft.com/blog/2008/02/19/11022/trading-today-more-var-less-income/