Barclays has announced a 25% rise in half-year profits to £3.1bn just weeks after sacking its chief executive Antony Jenkins.
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The strategic plans announced Wednesday were made three years into a prolonged period of transition at Barclays after an era of high returns from its once-huge investment bank was ended by rising capital requirements and the exit of former CEO Bob Diamond.
‘There is more that can be done to deliver better returns for shareholders, faster, and that work has begun.’.
For the second quarter net profit rose to £1.4billion, up from £391million in the same period past year.
Included in the provision is a further £600m for the payment protection insurance mis-selling scandal and £250m to compensate customers with packaged bank accounts that had other products, such as insurance, attached to them.
Chairman John McFarlane, who arrived at Barclays in April with a reputation for taking bold action, said he will cut its costs as a percentage of income to “mid 50s” percent and cut non-core assets to £20bn by 2017.
Barclays has been involved in controversies such as alleged rigging of the inter-bank lending rate Libor and foreign exchange manipulation.
He said the bank would “act quickly to curtail activity which is marginal or which will not deliver the return on equity we require”. “I am personally pleased with the recent progress in the investment bank”.
Barclays share price rose at the opening bell this morning.
Meanwhile the £600 million increase in PPI provision was blamed on a fall in compensation claims over the scandal – which has dogged UK banks for years – not being as rapid as expected.
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“Group profits are up on both an adjusted and statutory basis, and our core franchises have performed well”.
