Last checked at 
LONDON (Alliance News) - Barclays' non-core division, which houses assets the bank is looking to sell or run down, could offset higher earnings in its core divisions in 2015, according to Nomura's European banks research team, which anticipates another restructuring of the core investment bank by the end of the year.
Barclays Tuesday reported a core adjusted pretax profit of GBP6.68 billion in 2014, and a non-core adjusted pretax loss of GBP1.18 billion, ahead of consensus analyst forecasts on both counts. Overall, adjusted pretax profit rose by 12% to GBP5.50 billion.
"We expect to see modest upgrades to the core earnings, but non-core earnings could offset that at group levels as consensus looks too rich on non-core revenues," the Nomura analysts write, reiterating a Buy rating and 290 pence price target on the stock.
As well as thinking Barclays is "well placed" for 2015, the Nomura team expects another restructuring of the core investment bank by the end of the year, if its estimates are correct, which would lead to "further release of capital, a lower global systemically important bank (GSIB) add-on and better return on equity".
A restructuring of the investment bank is already underway following a strategy revealed in May last year, as Barclays looks to cut staff numbers and risk-weighted assets in the division in order to lessen its influence on group results.
Barclays is now in its best shape since the financial crisis, according to Chief Executive Antony Jenkins, who welcomed the growth in adjusted pretax profit. However, the lender swung to a net loss as the costs of past misdemeanors swelled due to new provisions for the forex manipulation scandal and the costs of mis-selling payment protection insurance.
The results left Barclays among the worst-performing stocks in the FTSE 100 index, down 3.0% at 254.83 pence, although the shares are up by about 4.7% in the year to date.
Other equity analysts appear to share Jenkins' confidence in Barclays' prospects as his restructuring takes hold.
"Our Buy thesis is intact," says Jefferies' Joseph Dickerson, who has a 340 pence price target on the stock.
Ian Gordon, banking analyst at Investec, who has a Buy rating and a 295 pence price target on the bank, expects "disappointment" for the shares on Tuesday as he noted a "weak" statutory result even though underlying pretax profit was ahead of expectations.
"Good execution; reiterated targets," say Deutsche Bank's Jason Napier and David Lock, who have a Buy and a 295 pence price target on the stock.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
Copyright 2015 Alliance News Limited. All Rights Reserved.
