Barclays seeks to get bigger

One of the UK's largest high street banks, Barclays, has reported a big leap in annual profits to £3.5bn.

The bank benefited from its acquisition of Woolwich last year, plus a strong showing from retail banking.

The bank reported pre-tax profits for 2000 of £3.496bn, up from £2.455bn, a leap of 42%.

Jobs will continue to be cut however, with 2,100 more to go in the coming months. 2,700 jobs were cut during the last year.

Bad debt

Barclays said bad debt provisions rose by 32% in 2000 to £817m.

Analysts had forecast profits between £3.2bn and £3.6bn.

Shares in Barclays topped the list of blue chip risers in early FTSE 100 trading on Thursday, following the results.

The banks shares were 32p higher at 2206p.

Barclays said it saw the Woolwich acquisition saving more than £400m a year by 2004, through cost savings and increased income.

'No slowdown'

Barclays chief executive Matthew Barrett said income had been boosted by sales of Woolwich mortgages to Barclays customers and increased sales at Barclaycard.

And he said the integration was on course to be complete within two years.

"I'm excited by the possibilities for two great brands to acquire customers in the UK and in another two years we'll be where we want to be.

"But its a bit like painting the Golden Gate Bridge. As soon as you're finished it's time to start all over again," Mr Barrett said.

He added that despite the US economy slowing down, he saw no problems for Barclays.

"There is no question that there is a slowdown in the US.

"But we are comfortable with our portfolio as 90% of our loans are syndicated and we expect no problems," he said.

Eyeing Europe

On the euro, Mr Barrett said he could not ignore the fact that an enormous market was forming on the UK's doorstep and, as a result, he wants to erase borders.

He said that the recent wave of banking mergers was likely to be outstripped as the big players hooked up with foreign rivals.

"We see opportunities there. It's no secret that wave one, in-country consolidation is complete, and that the next wave two will be inter-country mergers," he said.

"This is conceptually attractive but regulatory and other hurdles make it somewhat complex. We are keeping our eyes closely on it and intend to be a European player."

Commenting on the consolidation taking place in the UK banking sector, Mr Barrett said he was keeping abreast of the situation.

He said Barclays was being recognised in the US as the premier European bank "and if you want to do business in Europe you come to Barclays".

He added that he wanted a 50/50 split between domestic and international profits but could not say when this would happen.