Barclays faces fresh US fines and inquiries amid £47m quarterly loss

By KRISTY DORSEY
Published on 31/10/2012 09:43

BARCLAYS chief executive Antony Jenkins faces further hurdles in rebuilding the beleaguered bank’s reputation following revelations of fresh fines and investigations in the United States.

The bank’s latest woes include looming penalties for the manipulation of power prices in the western part of the US and investigations into whether Barclays has breached US corruption laws. The new probes come in the wake of mis-selling and market-fixing scandals that ousted Bob Diamond, Jenkins’ predecessor.

The US Federal Energy Regulatory Commission is close to fining Barclays for taking big positions in the electricity market between 2006 and 2008 in a bid to influence daily index settlements. Barclays denies the charges and intends to defend itself “vigorously”.

The Securities & Exchange Commission and US department of justice are also looking at whether “relationships with third parties who assist Barclays to win or retain business are compliant with the US Foreign Corrupt Practices Act”.

The disclosures by Barclays came as the UK bank posted a pre-tax loss of £47 million for the third quarter, down from a profit of £2.4 billion a year earlier.

The loss included a £700m provision to cover the cost of compensating customers who were mis-sold payment protection insurance (PPI). The new provision was flagged up by the group in a profit warning last week, taking the total amount set aside by Barclays for PPI claims to £2bn.