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Barclays first quarter profits fall 25% | Barclays first quarter profits fall 25% |
(35 minutes later) | |
Barclays adjusted first quarter profits have fallen 25% to £1.8bn, largely due to the bank's restructuring programme. | Barclays adjusted first quarter profits have fallen 25% to £1.8bn, largely due to the bank's restructuring programme. |
The bank is transforming itself into what it calls a "Go-To" bank. | The bank is transforming itself into what it calls a "Go-To" bank. |
Barclays has come in for much criticism in recent years, following a series of scandals. | Barclays has come in for much criticism in recent years, following a series of scandals. |
Much of the £609m profits fall is down to the costs involved in restructuring its investment banking arm, Barclaycard and its private wealth and investment management division. | Much of the £609m profits fall is down to the costs involved in restructuring its investment banking arm, Barclaycard and its private wealth and investment management division. |
Rising losses at its European operations also contributed to the fall in profits. | Rising losses at its European operations also contributed to the fall in profits. |
Barclays' Chief Executive, Antony Jenkins said: "In our goal to become the 'Go-To' bank we have not chosen an easy path for Barclays, but we have chosen the right one." | Barclays' Chief Executive, Antony Jenkins said: "In our goal to become the 'Go-To' bank we have not chosen an easy path for Barclays, but we have chosen the right one." |
The profits were hit by a charge of £514m to cover the bank's "Project Transform", a plan to axe 3,700 jobs, cut back its investment banking arm and generally overhaul the bank's culture. | |
Barclays expects to make a further £500m charge later this year. | |
Mr Jenkins is trying to revamp the image of Britain's third-largest bank, after the aggressive culture of former Barclays boss, Bob Diamond culminated in a £450m fine for rigging Libor rates. | |
Good start | |
Stripping out the costs of its transformation programme, Barclays pre-tax profits for the first three months to the end of March were £1.5bn, prompting the bank to say it had had a good start to the year. | |
That compares to a loss in the same quarter last year of £525m. | That compares to a loss in the same quarter last year of £525m. |
Barclays the return to this "statutory" profit is due to a significantly lower own credit charge of £251m, compared with one of £2.6bn in the first quarter of last year. | Barclays the return to this "statutory" profit is due to a significantly lower own credit charge of £251m, compared with one of £2.6bn in the first quarter of last year. |
The own credit charge is a valuation that banks are required to carry out. They book losses when the value of their debt rises, and gains when it declines. | The own credit charge is a valuation that banks are required to carry out. They book losses when the value of their debt rises, and gains when it declines. |
While Barclays is looking to trim its investment banking arm, the division saw an 11% rise in profits to £1.3bn, accounting for three quarters of the group's overall profits. |