Barclays PLC, Britain's third-biggest bank, said Thursday it is on track to meet analyst expectations of a full-year profit before tax of 4.5 billion pounds (US$8.5 billion, ¤6.5 billion), despite a flat performance from its domestic retail banking business. The bank said that its investment banking unit, Barclays Capital, and asset manager, Barclays Global Investors, produced strong results for the nine months ended Sept. 30. "Barclays remains on track to deliver a very strong performance in 2004," said chief executive John Varley. "As we continue to increase earnings, we continue to invest for the future." The full year profit prediction, an increase of 18 percent on a year ago, takes account of difficulties at the bank's retail arm, which has been hit by a slowdown in the British housing market after a string of interest rate rises. The Bank of England has increased rates five times since last November from a low of 3.5 percent to the current 4.75 percent, slowing the pace of housing price rises and dampening enthusiasm for mortgages. Barclays, Britain's fifth-largest mortgage lender, has forecast an 8 percent decline in house prices in 2005. On the positive side, the bank said that it had made good progress with a restructuring that saw it cut 800 back-office jobs and recruit an extra 1,000 customer service workers. Its private clients division, international businesses, and credit card unit Barclaycard are all doing well, the bank said. It added that it had made good progress in discussions with the ABSA Group about acquiring a stake in the South African retail bank. Shares in the bank were down 3.4 percent to 541.5 pence (US$10.20, ¤7.76) on the London Stock Exchange in morning trade.
