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Barclays has reported a 31 per cent lift in third-quarter pre-tax profits to £1.1 million despite seeing a fall in investment bank trading revenues, after taking no further PPI provision.
The profit improvement was largely as a result of lower year-on-year misconduct provisions, notably on payment protection insurance, having taken another £700 million provision in the first half to take the total provision to £9.1 billion.
However net operating income was down four per cent to £4.4 billion, notably from an 18 per cent fall in investment banking revenue.
Barclays chief executive Jes Staley described the third quarter as “particularly significant” as he outlined new financial targets in a bid to meet his target of achieving a 10 per cent return of equity by 2020 and 9.0 per cent return by 2019.
The bank has also set out its UK ring-fence plan which will see it restructure its retail and investment banking activities into two entities, Barclays Bank UK Plc which will operate separately from Barclays Bank Plc in a bid to protect retail deposits in the event of another financial crash.
Its proposed restructure is to meet regulatory rules demanding all British banks with more than £25 billion of UK deposits section off their retail operations from their riskier investment banks by 2019.
Staley said: “The third quarter of 2017 was particularly significant for Barclays as it was the first for many years in which we have not been in some state of restructuring.
“We now have high confidence in our capacity to assert when Barclays will start to deliver the economic performance which we know this group is capable of, and therefore today we are announcing new targets for 2019 and 2020 for Barclays.”
He added: "The third quarter was clearly a difficult one for our markets business within Barclays International.
“A lack of volume and volatility in FICC hit markets revenues hard across the industry, and we were no exception to this trend.
“We did however see an improvement in profitability in Barclays UK, and a good underlying return from our consumer, cards and payments business, which partially offset the under-performance in markets.”
Barclays notes its liquidity pool increased to £216 billion as of 30 September, up from £165 billion at the 2016 year end.
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