Newspaper article The Evening Standard (London, England)

Barclays' Chief Says Sorry as Its Profits Dive; Price Pledge: Varley Said the Bank Would Work Hard to Bring a Recovery in the Shares

Newspaper article The Evening Standard (London, England)

Barclays' Chief Says Sorry as Its Profits Dive; Price Pledge: Varley Said the Bank Would Work Hard to Bring a Recovery in the Shares

Article excerpt

Byline: NICK GOODWAY

BARCLAYS boss John Varley apologised to shareholders today for the bank's falling share price as first-half profits dropped by a third and it took another ?1 billion hit from the credit crunch.

That made the bank's credit crunch writedowns for the first six months of the year ?2 billion and left its investment banking arm Barclays Capital, run by Barclays president Bob Diamond, nursing a 68% collapse in profits to ?524 million.

In turn that accounted for the bulk of the fall in group profits from ?4.1 billion to ?2.75 billion in the six months to end- June on flat revenues of ?11.8 billion.

"A decline in profits of 33% is acutely disappointing," admitted Varley. "And I add to that my disappointment at the decline in our share price [down 44% in the past year]. Our shareholders have had to endure a lot. We are, and we will be, working as hard as we can to create the conditions that enable a higher price to be placed on our shares over time." He told investors there were no quick fixes, adding: "We have experienced significant writedowns. But it would be wrong to suggest that market conditions over the foreseeable future will be anything other than tough, not least because we are now seeing the impact of slowing economies around the world and that means we must remain very vigilant to managing risk.

"In some areas of our business, it may take quite some time for volumes to be restored to those we have seen in the past: we see patterns of deleveraging by both companies and personal customers around the world, and this will continue to impact on activity levels. …

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