Barclays have recorded a rise in their profit margins of 25% pre-tax. This takes their profits up £3.1 billion for the six months leading up to the end of June 2015.
Their profits in 2014 reached £2.55 billion. This news came in spite of the bank having to set aside £850 million in order to pay compensation to customers, many of whom were mis-sold PPI (payment protection insurance).
This news has broken not even a month after the CEO, Antony Jenkins, was fired by the recently appointed chairman John McFarlane.
Barclays has now had to save around £6 billion in order to cover the amount of compensation that was owed to people they wrongfully sold PPI.
Barclays were also forced to reserve around £800m in April, mainly to pay for possible actions being taken against them for manipulation of the foreign exchange markets. This money being set aside meant that Barclays resulted a fall in profits of 26% – down to £1.34 billion in the first quarter.
Barclays also made £496m off of the sale of assets bought following the crash of the Lehman Brothers back in 2008.
The bank has also recently announced that it will keep its dividend of 6.5p this year – equally to the amount paid last year.
Early trade on the London Stock Exchange showed that Barclay’s share prices had risen 2% – up to 285.10p.
The new chairman, John McFarlane, has stated that he believes the turnaround at Barclays is not happening quickly enough. He took over Aviva back in 2012 to try and lead the company to higher returns before they find a different chairman – expected next year at some point.
“There is more that can be done to deliver better returns for shareholders, faster, and that work has begun.”