© Reuters. The Barclays logo is seen on public hire bicycles in central London October 30, 2014. REUTERS/Toby Melville/Files
By Lawrence White and Iain Withers
LONDON (Reuters) – Barclays (LON:) reported a 14% fall in annual profits, as costs from an administrative blunder that saw it oversell securities in the United States compounded a collapse in deal fees earned by its investment bank.
The British lender reported a pretax profit for 2022 of 7 billion pounds ($8.5 billion), down from 8.2 billion pounds the year before and just below the 7.2 billion pounds average analyst forecast, as compiled by the bank.
Returns on equity booked by the international unit which houses Barclays’ transatlantic investment bank fell to 10.2% from 14.4% a year earlier, as fees from advising on debt and equity fundraising plunged by almost two-fifths year on year.
Profits before tax in that division also tumbled by 23% to around 5 billion pounds.
Barclays reported revenues from Fixed Income, Currencies and Commodities (FICC) trading, its traditional strength, rose 65% to 5.7 billion pounds from the previous year, beating U.S. rivals Morgan Stanley (NYSE:) and Goldman Sachs (NYSE:) which reported 20% and 38% year-on-year increases respectively in 2022.
Barclays paid an annual dividend of 7.25 pence per share, in line with forecasts, and also announced a fresh share buyback of 500 million pounds to bring the total for 2022 to 1 billion pounds.
Barclays posted litigation and conduct charges for the year of 1.6 billion pounds, including fines and restitution to customers from overstepping agreed limits on sales of investment products in the United States.
In its annual report also published on Wednesday, Barclays said it had docked top executives’ pay by a combined 1 million pounds to reflect the regulatory misteps.
Barclays’ results were further marred by 1.2 billion pounds in credit impairment charges as Britain’s economy continued to slow.
Barclays is the first big British bank to report its annual earnings this week, with analysts and investors likely to focus more on the bank’s forward-looking guidance about the outlook for this year, than on its performance in 2022.
The lender said it would achieve its goal of making a more than 10% return on tangible equity next year, having previously described this as a ‘medium term’ goal.
($1 = 0.8239 pounds)