Barclays Plc First Half Earnings Fall by 38%

Barclays Plc First Half Earnings Fall by 38%

SHARE

Barclays Plc, Britain’s second- largest bank by assets, said first-half earnings fell 38% on declining investment banking revenue and on provisioning for mis-sold mortgage insurance.

In a statement issued by the lender, Barclays’ net income for the six months to June 30 fell to ₤1,5 billion, down from ₤2.43 billion a year earlier, beating the ₤1.29 billion median estimate of 11 analysts surveyed by Bloomberg.

“While the performance of our capital markets business in July has been impacted by current market conditions, our other businesses have performed in aggregate ahead of their run rate for the first six months of the year,” finance director Chris Lucas said in the statement.

European banks have reported falls in investment banking revenue as the continent’s sovereign debt crisis reduced income from the sales and trading of stock, bonds, currencies and commodities. British banks have also been hit by the costs of compensation for the mis-selling of mortgage payment insurance.

So far this year, Barclays has cut 1 000 jobs at its consumer unit in the UK, 700 at its Spanish consumer business, 100 at Barclays Capital and 500 at its UK corporate division. The bank said employee costs rose 5% to ₤6,11 billion in the first six months of the year. It employs about 147 500 people globally.

The British bank also warns that it could cut a total of 3 000 jobs in 2011 as part of an ongoing drive to reduce costs.

Entrepreneur
Entrepreneur Magazine is South Africa's top read business publication with the highest readership per month according to AMPS. The title has won seven major publishing excellence awards since it's launch in 2006. Entrepreneur Magazine is the "how-to" handbook for growing companies. Find us on Google+ here.