Published On: Fri, Feb 24th, 2017

Bank swings back into profit in 2016

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British bank Barclays returned to profit in 2016 after slashing provisions set aside for legal and compensation costs linked to foreign exchange and insurance scandals, it said Thursday.

Barclays reported annual net profit of £1.62 billion ($2.0 billion, 1.92 billion euros) compared with a loss after tax of £394 million in 2015, it said in an earnings statement.

The bank set aside no amount at all in 2016 for “ongoing investigations and litigation including foreign exchange”, whereas it had taken a hit of more than £1.0 billion over the matters in 2015.

Barclays did provide £1.0 billion last year to compensate customers who were mis-sold a UK insurance product, although this was substantially lower compared with a bill of £2.65 billion for 2015.

Regarding day-to-day operations, Barclays chief executive Jes Staley said that the bank’s core businesses in the UK and abroad were performing well, with pre-tax profits up four percent to £6.4 billion.

American veteran banker Staley joined the bank in December 2015, and was tasked with restoring the bank’s battered reputation following a series of high-profile scandals, including the rigging of foreign exchange and Libor interest rate markets.

“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,” Staley said in Thursday’s statement.

“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,” he added.

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