Barclays says Q1 profits dip, seeks to sell French unit

2 min

London (AFP)

British bank Barclays posted sliding profits Wednesday, hit by losses in non-core units that it is seeking to offload, and revealed talks to sell its French retail operations.

Earnings after taxation declined seven percent to £433 million ($630 million, 558 million euros) in the three months to March, Barclays said in a results statement. That compared with net profit of £465 million last time around.

Pre-tax profits however sank 25 percent to £793 million, hit also by a jump in credit impairment charges.

That undershot market expectations of £846 million, according to an average of analysts' forecasts provided by the group.

The troubled bank added it has entered "exclusive discussions" with AnaCap Financial Partners over the possible sale of its French retail banking activities, in a move which would mark its exit from continental European retail banking.

The talks are part of Barclays' ongoing efforts to shed non-core assets, as it attempts to recover from several scandals.

The French operations include its network of 74 branches, life insurance business, and wealth and investment management operations.

The division employs around 1,000 people in France, according to a company spokeswoman.

Barclays added it will continue to operate its corporate and investment banking activities in France.

“Accelerating the disposal of our non-core unit is the key to creating a simpler, more focused Barclays, and to eliminating the drag on the performance of our strong core business," said chief executive Jes Staley.

"Today’s announcement, together with the sale of our Asia Wealth operations announced earlier this month, represent significant steps forward, and are tangible evidence of the progress we continue to make.

“This transaction, once completed, would effectively finish our exit from Continental European branch-based retail banking,” said Staley, adding that the French unit "no longer fits" with the group's strategic ambitions.

In March, Barclays had revealed a shake-up of the beleaguered bank with plan to exit its African operations, having already announced its departure from Russia in January.

The troubled bank is still seeking to restore its battered reputation under the leadership of Staley.

The lender decided last month to split the bank into two units, focusing on its operations in Britain and the United States.

Staley, an American veteran banker who began his latest role in December 2015, has been tasked with restoring the bank's battered reputation caused by a series of scandals including the rigging of foreign exchange and Libor interest rate markets.