Barclays (investment bank) has reported a decrease of 14% in its annual profits. According to the bank, administrative blunders and high expenses lead to a significant reduction in the annual profit.
In addition, the bank also had to pay a hefty fine due to the blunder made by the administration, which also hurt the company's bottom line.
According to the reports, Barclays earned $8.5 billion in 2022 as a pretax profit which is roughly equal to 7 billion pounds. And just last year, the company earned 8.2 billion pounds of revenue.
Similarly, the investors were hoping to see a profit somewhere around $7.2 billion... This means that Barclays has missed the target set by the analysts!
After the results, Barclays shares were down by 8% during the early trading session. In fact, the stock was all set to close one of its worst days since the Ukraine war.
According to Analysts, the revenue numbers were underwhelming, provided that we are living in the era of higher interest rates. In addition, the higher cost of living and inflation are also important factors to consider in all of this!
When a senior investment manager was asked about what Barclays could do to improve the situation, he had many things to say.
According to him, the bank will have to deal with its legacy issues and the errors which are deteriorated the company's results for years. If Barclays can manage that, it will easily top the list as one of the biggest UK lenders!
As per the data provided by Barclays, its revenue from commodities, currencies, and fixed-income trading saw an increase of 65%. This means that the company has beaten Goldman Sachs and Morgan Stanley from the USA, which reported a 38% and 20% increase, respectively.
After the announcement, Barclays is expected to pay 7.24 pence as a dividend which is in line with the market expectations. In addition, Barclays has also announced a 500 million pounds worth of share buyback program.