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Barclays Bank profits fall 3% to £5.9bn Barclays Bank profits fall 3% to £5.9bn
(40 minutes later)
Barclays has reported a 3% fall in profits to £5.9bn for last year, hit by a slowdown at its investment bank arm.Barclays has reported a 3% fall in profits to £5.9bn for last year, hit by a slowdown at its investment bank arm.
The bank also said the bonus pool at the investment banking division was down 32% to £1.5bn in 2011.The bank also said the bonus pool at the investment banking division was down 32% to £1.5bn in 2011.
There was no immediate news on the bonus for its chief executive Bob Diamond, reportedly in line for a payout worth several million pounds.There was no immediate news on the bonus for its chief executive Bob Diamond, reportedly in line for a payout worth several million pounds.
Last month, Royal Bank of Scotland chief executive Stephen Hester turned down his bonus, worth nearly £1m.Last month, Royal Bank of Scotland chief executive Stephen Hester turned down his bonus, worth nearly £1m.
Barclays' total bonus pot for the year will now be about £2.15bn, down 25%, with cash bonuses capped at £65,000.Barclays' total bonus pot for the year will now be about £2.15bn, down 25%, with cash bonuses capped at £65,000.
The average bonus payout for a Barclays' employee fell 21% year-on-year to £15,200.The average bonus payout for a Barclays' employee fell 21% year-on-year to £15,200.
The bank, the UK's fourth largest by market value, received no injection of state aid during the financial crisis and had previously indicated that it felt under no obligation to cut bonuses.The bank, the UK's fourth largest by market value, received no injection of state aid during the financial crisis and had previously indicated that it felt under no obligation to cut bonuses.
Barclays' results come after weeks of conflict over bankers' bonuses, in which Mr Hester turned down £963,000 worth of shares and Lloyds Banking Group chief Antonio Horta-Osorio waived his own payout following a leave of absence.Barclays' results come after weeks of conflict over bankers' bonuses, in which Mr Hester turned down £963,000 worth of shares and Lloyds Banking Group chief Antonio Horta-Osorio waived his own payout following a leave of absence.
'Challenging' environment'Challenging' environment
Income at investment bank arm Barclays Capital (BarCap) fell to £1.8bn in the fourth quarter of last year, down 19% on the previous three months. The eurozone debt crisis hit the division's bond trading activity.Income at investment bank arm Barclays Capital (BarCap) fell to £1.8bn in the fourth quarter of last year, down 19% on the previous three months. The eurozone debt crisis hit the division's bond trading activity.
Mr Diamond said in a statement: "Against a backdrop of challenging economic and market conditions, we maintained our focus.Mr Diamond said in a statement: "Against a backdrop of challenging economic and market conditions, we maintained our focus.
However, BarCap's return on equity fell to 5.8% for the year, down from 7.2% in 2010 and less than half its target of 13%.However, BarCap's return on equity fell to 5.8% for the year, down from 7.2% in 2010 and less than half its target of 13%.
"We are not satisfied with the return on equity we delivered in 2011 and are committed to delivering steady improvement moving forwards," Mr Diamond said."We are not satisfied with the return on equity we delivered in 2011 and are committed to delivering steady improvement moving forwards," Mr Diamond said.
"We expect the economic and regulatory environment to continue to be challenging in 2012," he added."We expect the economic and regulatory environment to continue to be challenging in 2012," he added.
Barclays said losses on bad loans fell by a third from 2010 to £3.8bn.Barclays said losses on bad loans fell by a third from 2010 to £3.8bn.
The bank said it had exceeded its targets on lending to UK businesses under the Project Merlin programme, with £43.6bn of gross new lending to businesses, including £14.7bn to small and medium size firms.The bank said it had exceeded its targets on lending to UK businesses under the Project Merlin programme, with £43.6bn of gross new lending to businesses, including £14.7bn to small and medium size firms.
The bank also said it had strengthened its Tier 1 capital ratio - money held in reserve as a buffer against financial troubles - to 11%.The bank also said it had strengthened its Tier 1 capital ratio - money held in reserve as a buffer against financial troubles - to 11%.
Analyst Richard Hunter, of head of equities at Hargreaves Lansdown Stockbrokers, gave a cautious welcome to the results.
"Barclays has dodged some, but not all, of the bullets which have come its way," he said.
"These are difficult times and the results mirror challenges already reported by other global banks of late.
"The significant drop in revenue at Barclays Capital was largely trailed but nonetheless dents overall progress."
Barclays is the first of the big UK banks to report its annual profits.Barclays is the first of the big UK banks to report its annual profits.