LONDON (Alliance News) - Barclays PLC's strategic cost management programme has partially offset challenging first-quarter for the investment bank's fixed income, credit, and commodities (FICC) business, and is expected to result in only a small reduction in adjusted pretax profit for the group, Chief Executive Antony Jenkins will tell shareholders Thursday.
In a statement, Barclays said Jenkins will make the comments at the bank's annual general meeting, scheduled to begin at 1100 BST Thursday. The AGM has been hotly anticipated as the bank has been under fire for increasing its 2013 bonus pool despite a fall in adjusted pretax profit.
"A number of actions are being taken to improve the performance of the group, with our strategic cost management program starting to provide a material benefit across all businesses in the first-quarter," Jenkins will say.
"This has helped to provide an offset to the income performance in FICC and, compared to the first-quarter of the prior year, is expected to result in a small reduction in adjusted profit before tax for the group. On May 8 we will update the market on further actions we are taking to better position both the group and the investment bank to deliver improved and sustainable returns for our shareholders given the regulatory and operating environment," Jenkins is set to say.
FICC revenues have come under pressure amidst questions of how much of the decline is cyclical or something more structural and long-term. Low interest rates, increasingly stringent regulation - which means banks must hold more capital to back up their positions - and a push by regulators to force derivatives to be centrally cleared are all factors in the decline of FICC returns.
Barclays shares were Thursday quoted at 252.00 pence, up 1.3%.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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