Barclays profits surge, bosses decline bonuses

Barclays bank more than doubled net profit last year to almost £9.4 billion, boosted by an asset sale, but said yesterday that its top executives would shun bonuses amid outrage over pay.

A 49-per cent jump in bad loans weighed on underlying earnings, Barclays said in an earnings statement, adding that its chief executive officer and president had declined a bonus for a second year running amid "intense public interest and concern" over bankers' pay.

Barclays said that net profits surged 114 per cent to £9.393 billion (€10.807 billion) last year after the bank had sold Barclays Global Investors (BGI) to US asset manager BlackRock in late 2009.

Net profit had stood at £4,382 billion in 2008.

"The Board considers that the performance of Barclays has been strong in 2009," the bank said in its earnings statement.

"However, out of consideration of the continued impact of the economic downturn on many clients, customers and shareholders, combined with the fact that banks and bankers' pay remain matters of intense public interest and concern, both (chief executive officer John Varley and president Bob Diamond) have advised the Board that they wish to decline any such awards for the second successive year."

Barclays share price jumped 5.74 per cent to 290.6 pence in morning trade on London's benchmark FTSE 100 index, which was up 0.95 per cent at 5,217.26 points.

"With or without the sale of BGI, the figures are extremely impressive," said Richard Hunter, head of British equities at Hargreaves Lansdown Stockbrokers.

"The performance of (investment unit) Barclays Capital was a core contributor to the profit numbers, whilst the impairment levels appear to be under control."

Barclays said that annual pre-tax profit was up 92 per cent at £11.642 billion. That beat analyst expectations of profit totalling £11.31 billion, according to Dow Jones Newswires.

However, excluding a £6.331 billion gain from the sale of BGI, profit before tax stood at £5.311 billion, down 13 per cent compared with 2008. Impairment charges for the year jumped 49 per cent to £8.07 billion. However, the figure was below the bank's own estimate of nine billion pounds.

Despite the hike in debts written-off, Barclays has successfully avoided state control, unlike rival British banks that were beaten by the global financial crisis and bailed out by the taxpayer.

Barclays had in 2008 won a £7 billion capital injection largely backed by Abu Dhabi and Qatar, as it survived the credit crunch without government aid.

But Abu Dhabi has since sold most of its holding, while Qatar's sovereign wealth fund, the Qatar Investment Authority, has trimmed its Barclays stake.