Barclays Set To Cut 3,000 Jobs After Missing Profit Expectations
Barclays is set to cut about 3,000 jobs this year to reduce costs after a drop in bond trading and an insurance mis-selling charge cut first half profits by a third.
The British bank's performance was more resilient than rivals, however, as bad debts tumbled and it kept costs steady.
"It's better on costs and impairments, and within the revenue line BarCap had a relatively strong quarter compared to its peer group," said Mike Trippitt, analyst at Oriel Securities. "It has been a savage market out there."
Chief Executive Bob Diamond, the American who built investment banking unit BarCap into a debt market powerhouse over the previous decade, said Barclays had cut 1,400 jobs during the first half and the tally was likely to rise to about 3,000 by the end of the year.
"We haven't set specific headcount numbers, but I would expect the trend in the first half to continue and I think it would be likely to increase," Diamond said.
The staff cuts amount to about 2 percent of Barclays' total workforce of 146,100.
Half the cuts so far in 2011 were at BarCap, which shed the same number in the second half of last year. The layoffs reverse an aggressive build-up that included its 2008 takeover of the U.S. arm of Lehman Brothers and equities and advisory expansion. BarCap has 24,100 staff.
"A key part of getting our returns to where we want them to be is the cost program we have put in place and that is going well," he told reporters on a conference call.
Pretax profit for the six months to the end of June was 2.6 billion pounds ($4.3 billion), down 33 percent from a year ago but above the average forecast of 2.4 billion pounds among analysts polled by the company.
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