"Barclays continues to pull the old good bank, bad bank routine, though soon it’s going to need to find a different tack, because the bad bank is being consigned to the history books."
Its core business saw a 4% rise in profit before tax to £4.9bn, however group profits decreased by 10% to £2.9bn driven by the disposal of 'non-core' units.
The Bank also set aside an extra £600m for PPI mis-selling claims in Q3, with the extra provisions attributed to the revised complaints deadline proposed by the FCA.
James Staley, Group CEO, said: “Our strategic priorities remain: strengthening our Core businesses; closing Barclays Non-Core as fast as possible; progressing the sell down of our stake in Barclays Africa to a point where we can achieve regulatory deconsolidation; eliminating costs in both Core and Non-Core; dealing with legacy issues; and meeting our end state capital requirements.
"Taken together, the picture in the third quarter is one of strong progress against this agenda. Our Core businesses are performing well, Non-Core rundown is approaching the final lap toward closure, we are on top of costs, and our capital position is resilient with strong reasons for confidence in meeting our end state target.
"The growing momentum in attaining our strategic goals means we can feel optimistic of our prospects of completing the restructuring of Barclays - a restructuring to a simplified transatlantic, consumer, corporate and investment bank with the capacity to deliver sustainable high quality returns for shareholders. This quarter has seen us take another important stride toward that state."
Laith Khalaf, Senior Analyst at Hargreaves Lansdown, commented: "Like Lloyds, Barclays has been hit by a big PPI charge as a result of the FCA’s decision to call time on complaints in 2019, rather than 2018 as had been expected. Barclays has also seen a pick-up in credit impairments, though some of this comes from a more prudent approach to modelling bad loans.
"Barclays continues to pull the old good bank, bad bank routine, though soon it’s going to need to find a different tack, because the bad bank is being consigned to the history books. Barclays expect to close this side of the business next year, which will be a big step for the bank, and will allow it to fully focus on its core activities.
"Barclays still has work to do, but there’s an increasing amount of light at the end of the tunnel. However despite the bank’s international exposure, it is still vulnerable to poor economic conditions in the UK, so if we do get a Brexit-induced slowdown, Barclays will feel the burn.’
