These provisions, teamed with £1.1bn in PPI repayments and a £446m loss after the sale of its Spanish arm meant that statutory annual profits at the bank were down 21%.
However Chief executive Antony Jenkins announced a 12% rise in adjusted pre-tax profits to £5.5 billion, discounting these payments.
Barclays attributed the higher-than-expected profits to cost saving initiatives, including cutting the level of bonuses paid by the bank by 22% to £1.86 billion.
Barclays' investment bank saw the biggest loss in 2014, with profits falling 32% to £1.38 billion. Barclays are now planning to shrink its investment bank under transformation plans.
Finance Director Tushar Morzaria said:
"Although there remains uncertainty in the global macroeconomic environment, which is expected to persist through the year, we believe there will be greater clarity on regulatory requirements and several conduct issues during 2015."
Mr Jenkins said:
"While our work in transforming the bank is not complete, our performance in 2014 gives us confidence that we are on the right track.
"We remain focussed on addressing outstanding conduct issues, including those relating to Foreign Exchange trading. I regard the behaviour at the centre of these investigations as wholly incompatible with our values, and I share the frustration of colleagues and shareholders that matters like these continue to cast a shadow over our business. But resolving these issues is an important part of our plan for Barclays and, although it may be difficult, I expect that we will make significant progress in this area in 2015."
