Barclays bank reports return to profit, and bigger bonuses

February 11, 2014


Antony Jenkins, CEO of Barclays bank/AFP
Antony Jenkins, CEO of Barclays bank/AFP
LONDON, Feb 11 – Scandal-hit Barclays bank returned to net profit in 2013 and said on Tuesday that staff will receive increased bonuses, a source of public anger against banks at the height of the financial crisis.

Annual group profit after tax stood at £540 million ($886 million, 649 million euros).

That compared to a net loss of £624 million in 2012, Barclays said in a statement.

It increased the money available for bonuses by almost 10 percent to £2.378 billion.

“Despite challenging conditions, our underlying performance has been resilient and momentum is building, as evidenced by the results,” Barclays chief executive Antony Jenkins said in comments accompanying the results.

But ahead of the earnings report, Jenkins said he would not be taking a bonus, as Barclays looks to deal with significant litigation costs.

The bank, which is still working to repair its reputation following its role in the Libor interest rate-rigging scandal of 2012, is also among companies under investigation for possible manipulation of foreign exchange trading.

Barclays meanwhile took the unusual step of posting its bottom-line and adjusted pre-tax profits on Monday, a day earlier than scheduled, after the Financial Times business newspaper had published figures close to the mark.

While statutory pre-tax profits surged last year, adjusted earnings dropped and missed the bank’s own forecast amid cost-cutting across the group.

Reported profit before tax hit £2.9 billion in 2013, compared with £246 million in 2012, Barclays said.

Adjusted pre-tax profit, which the bank said took into account restructuring and litigation costs as well as other one-off charges, slumped 26 percent to £5.2 billion.

Barclays last month said it would set aside £330 million in provisions for the fourth quarter of 2013 to cover litigation and regulatory charges.

And last year it was forced into a huge £5.8-billion shares sale, or rights issue, to meet regulatory demands to strengthen its capital buffers.

In a fresh blow, Britain’s data watchdog on Sunday launched a probe after confidential files relating to Barclays customers were allegedly stolen then sold on to rogue brokers. The Information Commissioner’s Office said it would be looking into the case this week.

Barclays, which is reshaping itself under Jenkins, is in the process of cutting 1,700 jobs as it reduces the number of local branches in Britain.

Jenkins replaced Bob Diamond, who stepped down as chief executive of Barclays in July 2012 after the bank was fined £290 million by British and US regulators over the attempted manipulation of key interbank interest rates.


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