Barclays in currency probe as profits fall

Barclays: 26 per cent fall in third-quarter profits. Picture: PA
Barclays: 26 per cent fall in third-quarter profits. Picture: PA
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Banking group Barclays today reported a 26 per cent fall in third-quarter profits after earnings at its investment bank more than halved.

The lender also revealed it had been drawn into a worldwide investigation into alleged manipulation of currency rates, with a number of regulatory and enforcement authorities investigating foreign exchange trading, including attempts to manipulate benchmark exchange rates.

Barclays said it was cooperating and was reviewing its foreign exchange trading over a period of several years to August this year.

Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers, said the foreign exchange probe was “something of a concern” but the lender’s recent £5.8 billion rights issue has given its capital position “a healthy boost”. Its common equity tier 1 capital ratio improved to 8.4 per cent, from 8.1 per cent in June, rising to 9.6 per cent once the rights issue was taken into account.

Barclays posted an adjusted pre-tax profit of £1.4 billion for the three months to 30 September, down from £1.9bn for the same period last year but above analysts’ expectations of £1.25bn.

Profits at its investment bank tumbled to £463m, from £988m a year earlier, but chief executive Antony Jenkins insisted all areas of the group were well placed to benefit from the “slow and gradual economic recovery”.

He added: “While the resilience of our performance is welcome, I am not complacent, and my executive team know we must push harder in the final quarter and into 2014.”