Barclays in currency trading probe as profits plunge

Barclays revealed it had been drawn into a worldwide investigation into alleged manipulation of currency rates as it reported profits from its investment banking arm fell by half in the third quarter.

It said a number of regulatory and enforcement authorities were investigating foreign exchange trading, including attempts to manipulate benchmark exchange rates.

Barclays said it was cooperating and was reviewing its foreign exchange trading over a period of several years to August this year.

The group reported total profit before tax for the period down by 26% to £1.38 billion compared to the same period last year - though statutory profits, when some accounting provisions are included, were up sharply.

Barclays said pre-tax profits from its investment bank dropped by 53% to £463 million.

Lower activity was driven by uncertainty about when the US Federal Reserve would start slowing its quantitative easing programme that is pumping billions of dollars into the economy every month.

Profits from UK retail and business banking were 2% down at £351 million.

Meanwhile, the bank said that provision for mis-selling payment protection insurance remained unchanged. It has £1.26 billion left of a £3.95 billion pot set aside to cover compensation schemes.

PA