LONDON (AP) — Barclays, Britain’s second largest bank, said Tuesday that second quarter profit increased sevenfold, boosted by earnings from investment banking and a 496 million pound ($774 million) gain on assets acquired from Lehman Brothers in 2008.
Net income rose to 1.15 billion pounds in the quarter ended June 30, from 161 million pounds in the year-earlier period.
The report was the first since John McFarlane took over as executive chairman and fired CEO Antony Jenkins after concluding Jenkins wasn’t moving fast enough to cut costs and improve earnings.
While Barclays is performing well, “there is more that can be done to deliver better returns for shareholders, faster,” McFarlane said Tuesday.
Investment banking was Barclays’ fastest growing business in the first six months of the year, with pretax profit rising 36 percent, compared with 10 percent for the bank as a whole.
“I am personally pleased with recent progress in the investment bank,” McFarlane said. “The challenge for the team is to convert this performance into sustainable economic returns through subsequent periods.”
Jenkins became CEO in August 2012, charged with overhauling Barclays’ corporate culture after a series of scandals, including the bank’s role in rigging a market that helps determine consumer interest rates around the world. Jenkins had taken over from Bob Diamond, who had championed the investment operations within the bank.
Barclays set aside another 850 million pounds in the second quarter to compensate customers who were improperly sold products such as payment protection insurance, interest-rate hedging vehicles.
“Barclays appears eager to press ahead with the increased pace of restructuring,” said Richard Hunter, an analyst at Hargreaves Lansdown Stockbrokers.
“The legacy and fresh provisions for past misdemeanors remain a drag on overall performance, as Barclays attempts once and for all to consign those issues to history,” Hunter said.