BARCLAYS CAPITAL, the investment banking division of Barclays, aims to hire 50 people by the end of this year to develop a leveraged finance business in the United States.

Under the leadership of Joe McGrath and Rick Van Zijl, the former Goldman Sachs veterans, the company is spreading into higher-risk activities. The leveraged finance business plans to lend to non-investment grade companies, as well as underwriting high-yield bonds and offering mezzanine finance.

The group hopes to gain from corporate relationships built by high-yield colleagues in Europe. By building a US leveraged finance business, BarCap hopes to develop a global business in this area. The bank expects the energy and power sector to be an initial area of focus in the US, tapping into the strength of the bank’s commodities work. It will look to underwrite deals with credit ratings ranging from low single B to high CCC.

Mr Van Zijl said: “It is a strategic initiative for the Barclays franchise and integral to the efforts of BarCap.”

About 35 people have been hired, including former Goldman Sachs staff. The company hopes to do its first trades in the year’s third quarter. Mr Van Zijl said the group was mindful that it is expanding as experts forecast increased market volatility.

• John Varley, chief executive of Barclays, mortgaged his £1.5 million house in London with the rival HSBC, it has emerged. The bank’s finance director and its deputy chairman have also taken mortgages with rival providers. Barclays said the executives had been reluctant to take out mortgages elsewhere, but did so to keep their finances private from colleagues.

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