Five questions answered on Barclays’ first quarter profit fall
Today British bank Barclays announced that its adjusted first quarter profits have fallen. We answer five questions on the banks flagging profits.
By how much has Barclays’ adjusted first quarter profits dropped by?
They’ve fallen by 25 per cent to £1.8bn.
What’s responsible for this fall in profits?
It’s party to do with the bank restructuring itself into a "Go-To" bank, which Barclays’ chief executive Antony Jenkins has described as ‘not an easy path’ but ‘the right one’ for the bank.
A £514m bill to cover the bank’s “Project Transform” plan to axe 3,700 jobs has also hindered its profits
Are they expecting any other hits this year that could further affect its profits?
Later in the year it expects a further £500m charge as part of the “Project Transformation” which will see it cut back its investment banking arm and generally overhaul the bank's culture.
Despite its intentions to revamp this section of the business, the division saw an 11% rise in profits in this quarter to £1.3bn, accounting for three quarters of the group's overall profits.
Why is Barclays making these changes?
The third biggest British bank is trying to reform its culture after Jenkins predecessor, Bob Diamond, accumulated a £290m fine for rigging Libor rates.
What were the banks profits like at the beginning of the year?
For the first three months to March, Barclays said it had a good start to the year. It recorded pre-tax profits of £1.5bn, which compares to a £525m loss in the same quarter the year before.