Barclays shares tumble 9% as profit disappoints

Barclays reported a 14% fall in full-year pretax profit on Wednesday as earnings were poleaxed by surging costs, a collapse in deal fees and multi-million dollar fines relating to an administrative blunder.

Earnings fell short of expectations and came as rising interest rates should be boosting returns, sending shares in the British bank down 9% – on track for their biggest one-day fall since the early stages of the COVID-19 pandemic three years ago.

Analysts said the results showed how an improving performance in the core consumer and investment banking businesses continue to be undermined by conduct issues, even as the economic environment turns more positive.

“Barclays has bitterly disappointed the market,” said Hargreaves Lansdown equity analyst Sophie Lund-Yates. “Profits have been stunted partly because of a big increase in litigation costs relating to the over-issuance of U.S. securities.”