Today Barclay’s (LON:BARC) reported in their first half year results ending 30 June that profits have fallen 21% down from £2.6bn in 2015 to £2bn.
The bank also reported that net profits stood at £803m, a 18% decline from £1.2bn in the same period last year. The decline is thought to be due to the uncertainty across the markets following Britain’s decision to leave the EU which has drastically damaged the bank’s interest in assets.
As a result of the difficult economic environment, Barclay’s reported a loss of £1.9bn of it’s ‘non’core assets’ it had planned on offloading towards the end of the 2017 season. As such, was the group’s revenue which was down 7.5% falling to £5.97bn.
A mix of conduct charges and marginal compensation costs meant that operating expenses dropped to £7.7bn.
There was positive signs for the global giant however, as profits from its core business which accounts for its credit cards, consumer lending and investment, grew by 19% to £2.4bn.
Also rising was the bank’s core capital ratio, which grew from 11.3% to 11.6% beating expectations.
Chief Executive, Jes Staley said:
“Taken together, the picture in the second quarter is one of strong and accelerating progress against our strategy. We remain confident that it is the right plan for Barclays, and see no reason to adjust it, or the pace of delivery, in light of the vote by the UK last month to exit the EU.”
The direction Jes Staley hopes to lead the company, is for it to become a ‘transatlantic’ bank securing ties between the US and Britain. As such, the banks dividend prices remain at 3p in 2016 down from 6.5p from earlier cuts in order to sustain capital levels.
The group reaffirmed it’s target of delivering a full year cost target of £12.8bn.
One of the main points from the report announced that the bank has taken a £400m ‘provision for payment protection insurance’ meaning that the overall costs from the scandal so far have amounted to £7.8bn.
In early morning trading, Barclays share price increased 3% trading shy of 150p.
At 10:10am BST Barclays PLC traded at 155.88 + 9.38 (6.40%)
29/07/2016
