Barclays enjoyed a surge in profits to more than £3bn after it paid out less to settle litigation and to the victims of the payment protection insurance (PPI) scandal.
The bank, which has been streamlining in recent years to focus on Britain and the US, posted a jump in annual pre-tax profits to £3.2bn from £1.1bn in 2015. It was boosted by its falling litigation and conduct costs, which shrank to £1.4bn in 2016 from £4.4bn a year earlier.
The smaller hit from legal battles and the PPI scandal helped to drive operating expenses down by 12pc to £16.3bn and helped the bank’s common equity tier one ratio – a key measure of its capital buffer and a gauge of its financial strength – rise to a better-than-expected 12.4pc. This was much higher than the 11.8pc forecast by analysts.
Boss Jes Staley has been overhauling Barclays, selling off businesses in Africa and Asia as part of a wide-ranging revamp to improve returns. He said today that the lender’s so-called non-core division, which houses the subsidiaries that will either be offloaded or closed, will be shutdown by the end of June, six months earlier than previously planned. “A year ago we laid out our intention to accelerate the restructuring of Barclays and refocus our business as a transatlantic, consumer, corporate and investment bank, anchored in London and New York,” Mr Staley, who took the helm in December 2015, said. “We have made strong progress against this agenda in 2016. Our core businesses, Barclays UK and Barclays International, are doing well, with profit before tax excluding notable items up 4pc to £6.4bn. “We are now just months away from completing the restructuring of Barclays, and I am more optimistic than ever for our prospects in 2017, and beyond.”