Barclays investment bank makes first Q4 loss in three years


Barclays promise of a higher dividend policy on Thursday helped ensure a positive share price reaction, even after the United Kingdom bank reported a full-year net loss - hit by charges related to an asset sale and USA tax reforms.

"2017 was a year of considerable strategic progress for Barclays", Barclays' CEO Jes Staley said in a statement released with the results.

But the bank cheered investors as it announced a 3p-a-share dividend and said it would more than double the payout next year to 6.5p.

Barclays was the worst-performing bank in the FTSE 100 index .FTSE in 2017, falling nine percent on concerns about both its investment bank and its legal and regulatory troubles.

Revenues were £21.1bn and bonuses awarded to staff were flat at £1.5bn.

Revenues fell in all areas of the investment bank in the final quarter, partly because a drop in the value of the United States dollar translated into lower reported revenues in sterling. That underperformed its big USA rivals, which on average reported a 19% rise in revenues.

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"Although we are only seven weeks into the first quarter, and it is too early to offer formal guidance, we are pleased with the start to the year, and in particular in the markets businesses in CIB (corporate investment banking)".

Barclays said when reported in USA dollars, its banking fees were up 2% on the year, equities revenues were down 4% and credit and rates were down 14%.

The bank also reported setting aside £1.2bn for litigation and conduct, including £700m to cover further costs related to the payment protection insurance scandal and said it had taken a £127m hit in its final quarter following Carillion's collapse. While Barclays made an attributable loss on nearly £2 billion, pre-tax profits rose strongly, increasing by 10% from the previous year to £3.5 billion.

Pre-tax profits surpassed the 2016 figure of £3.2 billion, but fell short of analysts' averaged expectations of £4.7 billion.

A multibillion-pound bill linked to litigation and U.S. tax changes, coupled with heavy losses from the sell down of its Africa business, dragged Barclays into the red past year.

It also booked an additional £240m provision relating to alleged foreign exchange manipulation.