Barclays Axes 5,000 Staff as Investment Banking Profits Tank 46%

Barclays has cut 5,000 jobs across the bank and is on target to axe another 9,000 by the end of the year.

In the second quarter, Barclays' underlying profits fell 8% on the previous year. Its investment bank profits tanked 46%.

Speaking on a conference call following the bank's results announcement, Barclays finance director Tushar Morzaria said it remains on course for streamlining, trimming and cost cutting.

The bank said in the first half of this year operating costs fell by 6%, as a result of headcount reductions.

In the first three months of this year Barclays' pre-tax profit at the investment bank sank 49% to £668m after blaming difficult trading conditions and cuts to the business.

During that period Barclays had to field allegations from the New York Attorney General that it misled customers in its "dark pool" trading platform.

Mass Job Cuts

In May this year, Barclays said it would cut 14,000 jobs by 2014, a figure which is set to rise to 19,000 within three years, mainly from its investment banking division, and many of them in Britain.

Barclays, one of Britain's biggest banks, revealed that the job cuts will be part of its new streamlined strategy amid tumbling investment banking profits and higher regulation-related costs.

According to a range of estimates, Barclays employs around over 139,000 people across full-time and part-time positions.

"This is a bold simplification of Barclays. We will be a focused international bank, operating only in areas where we have capability, scale and competitive advantage," said chief executive Antony Jenkins at the time.

"In the future, Barclays will be leaner, stronger, much better balanced and well positioned to deliver lower volatility, higher returns, and growth.

"My goal is unchanged: to create a Barclays that does business in the right way, with the right values, and delivers the returns that our shareholders deserve. However, the way in which we will achieve this is different".

Around half of the headcount cull will be borne out of the UK workforce and while the investment bank will be worse hit, with 7,000 losses, the retail arm will see a cut in resources.

As part of Jenkins' plan, Barclays aims to pare down the amount the investment bank contributes to the group to around 30%, from 50%.