Barclays, the UK bank that last year disclosed a £1.3 billion credit write-off, sees present market conditions as a chance for its investment banking group to grow its operation, particularly in the US.

Bob Diamond, the president of Barclays and head of Barclays Capital, its investment banking arm, said today at Davos: "2008 brings one very important change to our priority list, and that's the United States.

“It is difficult to get into the home market of the US bulge-bracket firms, but as we go into 2008, so many of them are retrenching.

"I am determined that in two, three or four years' time we don't look back and say this was the market opportunity to move up into the top tier and we flinched."

America’s largest investment banks have damaged their valuations after writing off billions of dollars of assets invested in sub-prime mortgage debt.

But Mr Diamond said that Barclays was unlikely to grow in the US through acquisition as prices remained too high for the risks involved in a deal. Barclays lost out to Royal Bank of Scotland last year in the battle to acquire ABN Amro.

Mr Diamond said: “[Acquisitions] are very unlikely in the United States and very unlikely in investment banking. I would never say never, but I think the success of BarCap is the talent and culture, the organic growth."

Mr Diamond said he expected the worst to be over for the world's banks.

“We've seen the worst," he said. "We are bound to see one or two surprises, but I don't think they will be major.

"I think we are going to see a workout situation for all of the firms for probably two or three years, the excesses of the market were so large."

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