Barclays returns to profit in first quarter as it tries to move on from recent scandals

LONDON – Barclays PLC on Wednesday reported a return to profit in the first quarter, as it tries to restructure and get past recent scandals.

In the three months ending March 31, Barclays made an adjusted profit after tax of 839 million pounds ($1.3 billion). That contrasted with a 589 million pound loss a year earlier and came despite a 5 per cent fall in income to 7.7 billion pounds.

Costs included 514 million pounds for “Project Transform,” which aims to shed 3,700 jobs, trim Barclays’ investment banking arm and move on from scandals that included a $450 million fine for its involvement in the rigging of a key market interest rate.

Chief executive Antony Jenkins said Barclays expected to spend another 500 million pounds on Project Transform in 2013.

“While there remains much to do to build a stronger and more resilient Barclays, we are completely focused on executing our Transform program and are making good early progress,” said Jenkins, whose predecessor, Bob Diamond, resigned in the wake of the rate-rigging scandal.

Barclays’ investment arm performed solidly, with profit rising 11 per cent to 1.3 billion pounds.

Shares in the bank closed 1.3 per cent lower Wednesday at 2.95 pounds.

But analysts said the results were good news for the bank.

“Barclays has a Herculean task in reinventing itself whilst at the same time continuing to grow the business,” said Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers. “The update shows that the challenge is being faced head on, with a cultural shift in train and a more general restructuring being actively pursued.”