Barclays reports sharp drop in profits

Barclays has announced a 21 per cent fall in pre-tax profits.

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By :  ,  Financial Analyst

Barclays has reported a significant drop in pre-tax profits in its latest trading update.

The bank, which is the current sponsor of the Premier League, revealed a 21 per cent drop in pre-tax profits to £2.26 billion for the year to December 31st 2014. However, the bank explained that the figures were slightly more positive than first noted as it had set aside £1.25 billion to cover any potential fallout from a probe into currency market manipulation, an increase of £750 million.

It stated that by stripping this and other provisions from the results, it saw a 12 per cent in profits to £5.5 billion. Barclays was found to have paid chief executive Anthony Jenkins a bonus of £1.1 million, which increased his pay for 2014 to £5.5 million. However, the bank added that it had reduced its overall reserve of money for bonuses by 22 per cent to £1.86 million.

Despite the drop in profits, Mr Jenkins defended the current position of Barclays: "Barclays today is a stronger business, with better prospects, than at any time since the financial crisis,” he said.

"We remain focused on addressing outstanding conduct issues, including those relating to foreign exchange trading. Resolving these issues is an important part of our plan for Barclays and, although it may be difficult, I expect that we will make significant progress in this area in 2015."

Restructuring plans

Barclays announced in May 2014 that it would be scaling back its operations with plans in place to cut around 19,000 jobs. At the time, Mr Jenkins explained that the loss of roles would be focused at its investment bank and would help to avoid a repeat over the bonuses scandal seen in 2013.

The UK is expected to bear the brunt of many of the cuts with around scheduled to take place on British soil. Barclays explained that the proceeding months would prove "challenging for colleagues".

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