Corresponding to this decision, Barclays continued to scale down its non-core business in H1 2015, with risk-weighted assets dropping 24% from £75bn to £57bn in the period.
Non-core dilution of the bank’s return on average equity slid to 3.4% – down from 4.5% in H1 2014 – in line with average allocated equity being cut from £14bn to £10bn year-to-date.
The bank’s total adjusted operating expenses and operating expenses excluding costs were reduced, dropping 7% and 5% to £8.26bn and £7.95bn respectively.
Barclays improved its capital and leverage numbers, with its fully-loaded common equity tier one ratio rising from 10.3% to 11.1% in the past six months, while the leverage ratio reached 4.1%, thus hitting the group’s target for 2016.
The bank also set aside a further £850m towards customer redress, taking the total amount saved for PPI-related reimbursement to £6bn, while an additional £800m has been reserved for ongoing FOREX practice investigations, totalling £2.1bn.
McFarlane said: “We need to accelerate growth in earnings, return on equity, and capital generation. To do this, we intend to grow revenues at least in line with the market, reduce our group cost-income ratio into the mid-50s, accrete and deploy capital wisely, and thereby over time achieve a group return on equity above our cost of equity.
“I am not issuing new targets for the Group, but can confirm that we will adhere to our remaining targets. Now that we have achieved an 11% CET1 ratio, we would like this to continue to improve over time so that we reach our end state.”
