Barclays takes swipe at activist Bramson after strong second quarter

BARCLAYS chief Jes Staley has taken a swipe at activist investor Ed Bramson, insisting his strategy for firing up the investment bank was “paying dividends” after the lender posted bumper quarterly profits.

Mr Staley argued the FTSE 100 lender’s investment bank was proving its doubters wrong after improved trading so far this year, including a record six months for its M&A team amid a takeover boom. Overall pre-tax profits for the second quarter tripled to £1.9bn. But big payouts for past misconduct earlier in the year dragged down profits for the first half by 29pc to £1.7bn.

City analysts warned Barclays could be heading for a trickier second half of trading and raised doubts about its control on costs. Shares in Barclays fell 2.7pc to 186.54p. New York-based corporate raider Mr Bramson – who shocked the City by building up a more than 5pc stake in Barclays earlier this year – is understood to have pressed the case with other investors for downsizing the investment bank by offloading its trading division.

Mr Staley told reporters this would be too risky. “We don’t believe that you can pick slices of the business and get out of them without significantly impacting the whole,” he said. Mr Staley insisted the investment bank was improving. He said he had met Mr Bramson but he had not revealed his proposals to the bank directly.

Hefty one-off charges in the first quarter spoiled the results, including a £1.4bn settlement with US authorities for selling toxic mortgage products and £400m extra set aside for payment protection insurance claims. Stripping out exceptional costs, half-year profits jumped 20pc to £3.7bn.

Mr Staley said Barclays was on the right track to return more capital to shareholders and would consider whether to raise its dividend or start a share buyback “towards the end of the year and into next year”. The bank reiterated its plans to pay a 6.5p dividend this year.