Barclays to axe 3,700 jobs

The bank’s pre-tax profits plunged to £246m last year from £5.9bn in 2011.

New Chief Executive Antony Jenkins is shutting the bank’s controversial Structured Capital Markets tax advisory division and said 1,800 jobs would go in corporate and investment banking and another 1,900 across its European retail and business arm as part of a plan to slash costs by £1.7bn.

Nearly £2.5bn of cash set aside to cover mis-selling compensation claims contributed to the plunge in pre-tax profits.

Its bonus pot will mean each employee gets £13,300 on average, with an average of £54,100 for investment banking staff, although the pool is lower than the £2.2bn paid out last year.

Barclays said profits rose 26 per cent to £7.05bn on an underlying basis, with mis-selling provisions stripped out and not including movements in the value of its own debt.

Bottom line profits were heavily impacted by mis-selling provisions, with £1.6bn put by to cover claims relating to payment protection insurance (PPI) and £850m for interest rate swaps sold to small businesses.

It said the average PPI claim stood at £2,750, while it added the group sold around 4,000 interest rate swaps to small businesses of which around 3,000 were liable to potential mis-selling claims.