United Kingdom’s largest lender, Barclays said its profit for the half year ended June 2018 fell by 41% as its operating expenses weigh down its balance sheet.
Barclays reported that its profit after tax in respect of continuing operations fell to £922 million compared to £1.5 billion disclosed in the previous year.
The bank’s Group Chief executive, James E. Staley, Group Chief Executive Officer, said:
“The first half of 2018 has been characterised by strong financial performance and increased profitability.
Our Group return on tangible equity (RoTE) was 11.6% and profit before tax was £3.7bn, excluding litigation and conduct.
Barclays’ CET1 capital ratio was 13.0%, driven by strong organic earnings growth and the regulatory deconsolidation of Barclays Africa.
Within the Group numbers, Barclays UK produced a RoTE of 17.3% for the half, powered by good performances in Personal Banking and Business Banking. Barclays International delivered a RoTE of 12.9%, with strong profits in Consumer, Cards and Payments, as well as the returns in the Markets division of our Corporate and Investment Bank, being particular highlights.
The second quarter, where we generated a Group RoTE of 12.3%, underlines the growing pace of delivery at Barclays. This is a business which is performing well, having addressed the challenges of the last decade.
It was the first quarter for some time with no significant litigation or conduct charges, restructuring costs, or other exceptional expenses which hit our profitability. In effect then, it is the first clear sight of the statutory performance of the business which we have re-engineered over the past two and a half years – Barclays’ transatlantic consumer and wholesale bank – and it is a positive sight.
We are also pleased to see the burgeoning impact of our Group-wide Service Company’s focus on operational effectiveness, remaining on track for our cost target range for 2019 whilst also creating headroom to invest in growth.
This means we can begin to target opportunities to drive even better customer and client service, fuel top-line growth and generate further efficiency gains.
This first half performance shows a bank beginning to demonstrate its true potential and value. The numbers we have posted strengthen our confidence that Barclays can deliver attractive and sustainable profits, and in our ability to return a greater proportion of those profits to shareholders over time,” he said.