Barclays first quarter profit fell 25% to £793 million, after its non-core business sustained losses of £815 million.
Deals with education, social housing and local authority clients were repriced to reflect their fair value, causing losses of £374 million. The non-core business includes troubled assets which Barclays is trying to run-down and sell.
The results are the first in which Barclays split its core UK retail business and international and investment banking arms. Underlying profit in the core business fell 2%.
CEO Jes Staley said: “We can see clear growth opportunities, such as in our Consumer, Cards and Payments business, in which we want to continue to invest. The performance of our Corporate and Investment Bank was relatively resilient in a tough quarter, but there is more we must do to improve returns, and we are focused on management actions to do so.”
Here are some of the headline figures:
- Investment bank woes. “Underlying profit before tax decreased 31% to £701 million primarily driven by a reduction in Banking and Markets income, increased credit impairment charges and higher operating expenses.”
- Oil and gas credit hit. “Credit impairment charges of £95 million (Q115: release of £1m) arose primarily from impairment of a number of single name exposures, largely in respect of clients in the oil and gas sector.”
- Credit cards and payments are doing well. “Total income increased 24% to £917 million reflecting continued growth in Barclaycard US and Germany and the appreciation of average USD and EUR against GBP.”