Barclays reports 25% rise in profits

Profits last year were £2.55bn. The bank also set aside a further £850m to compensate customers – including further claims for mis-sold payment protection insurance.

The results come less than a month after the bank’s new chairman John McFarlane sacked Antony Jenkins.

In total, Barclays has now set aside £6bn to compensate for PPI mis-selling, according to The BBC.

Mr McFarlane is expected set out plans to speed up reform at the bank later.

In April, Barclays set aside a further £800m, largely to cover potential further legal action and penalties for alleged foreign exchange manipulation.

That resulted in Barclays reporting a 26 per cent fall in its first quarter statutory profits to £1.34bn.

But Barclays made a £496m gain on the sale of assets bought following the collapse of Lehman Brothers in 2008.

It also said it intended to maintain its dividend at 6.5p this year – the same as it paid in 2014.

Mr McFarlane, who took over as executive chairman of insurance giant Aviva in 2012 after sacking then chief executive Andrew Moss, believes Barclays’ turnaround is not happening quickly enough.

As he did at Aviva, Mr McFarlane, who only joined the bank in April, will take on executive duties, spearheading a quest for higher returns until a replacement is found, which, it is thought, is unlikely to be before early next year.

Barclays also said it had set aside £250m for customer refunds and associated costs in response to complaints received relating to its packaged bank accounts. These incur a fee, but often come with added extras, a typical example being free roadside assistance.

Mr McFarlane said Barclays needed to accelerate growth in earnings, return on equity, and capital generation.

The bank has already announced 19,000 job cuts.

He said: “There is more that can be done to deliver better returns for shareholders, faster, and that work has begun.”

Mr McFarlane also announced the bank would speed up the process of mothballing or selling the bank’s non-core divisions, to reduce them to a value of £20bn by 2017.