Barclays Capital, the investment banking arm of Barclays Bank, has launched a major recruitment drive for its in-house legal team and plans to hire up to 40 extra lawyers, the Gazette has learned.

It is understood that the department has already recruited about half of the lawyers, who will bolster the 244-strong Barclays global legal team.

The recruitment, which is being led by Barclays Capital general counsel Jonathan Hughes, is across the board but with an emphasis on debt finance, a market where the investment bank is particularly strong.

The expansion is also linked to several product launches.

The growth comes as Barclays revealed a restructuring of its main legal function, which will see compliance matters brought into the legal department and the creation of a 500-employee team.

A new chief operating officer for legal and compliance is being recruited to oversee the operation.

Barclays' main legal team - headed by former Clifford Chance partner Mark Harding - has been at the forefront of innovation in legal department strategy in recent years.

High-profile former general counsel Howard Trust - now at fund managers Schroder - introduced a radical programme of change in 2000, which included a panel review, reorganisation of the legal team structure and the cutting of around 50 legal staff.

The bank is also a leader in the use of legal technology.

A spokeswoman for Barclays Capital said: 'We can confirm that we are growing the Barclays Capital in-house legal team.'

By Rachel Rothwell