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Barclays' £7bn bank 'robbery' | the Daily Mail
Barclays' £7bn bank 'robbery'
Last updated at 13:49pm on 20th February 2007
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Profits at Barclays shot up by more than a third to a record £7.1 billion last year, it was announced today.
The figure was far higher than forecast and triggered a storm of protest from consumer groups and politicians.
Read more...
• Bank chief predicts the end of the free bank account
• Banks under siege as 300,000 join campaign to refund bank charges
• Single mum wins back £23,000 in bank charges for friends and family
• Special Report: The end of free banking?
• Today's news headlines
The 2006 result showed the high street arm of Britain's third biggest bank made £86 profit for each of its 14 million UK customers. And it means Barclays directors are in line for bonuses of at least £15 million.
The profits were today condemned as " daylight robbery" by Eddy Weatherill, chief executive-of the Independent Banking Advisory Service. He said: "It's a complete stitch-up. They are the new highwaymen.
"The banks are having a heyday and they will continue to do so while customers sit still and don't look at what is being offered elsewhere."
The announcement comes ahead of a key report from the Office of Fair Trading into high bank charges, which many customers claim are illegal. However, Barclays chief executive John Varley said free banking was not under threat - contradicting comments from the head of Nationwide last night.
Mr Varley also revealed a big increase in bad debts to £2.15 billion, as tens of thousands of customers struggle with spiralling credit card debts and loans. However, he insisted the worst of the "debt crisis" at Barclaycard was over, saying: "The number of customers missing a payment is falling. Arrears balances are also falling."
But critics said the vast profits, equivalent to the gross domestic product in Jamaica, revealed how customers were being ripped off. Liberal Democrat Treasury spokesman Vince Cable said: "These enormous profits highlight the raw deal UK consumers are getting from banks.
"The Government's failure to get to grips with the banking sector means that while banks boost their profits, many customers are getting deeper and deeper into debt."
There was also criticism of the "underhand" charges levied on customers who go above their overdraft limit. Nick White, director of financial services at price comparison website uSwitch.com, said: "Consumers really need to keep a close eye on the sneaky changes made by their bank, more now than ever before." Barclays is the first of the big five high street banks to report its profits.
Its top boardroom pay-out will go to Bob Diamond, head of the hugely successful investment banking arm Barclays Capital.
However, Mr Varley defended the profits, saying they benefited pension funds and allowed the bank to support "thousands" of community projects around the world.
Barclays' £7bn bank 'robbery'
Last updated at 13:49pm on 20th February 2007
Comments (2
Profits at Barclays shot up by more than a third to a record £7.1 billion last year, it was announced today.
The figure was far higher than forecast and triggered a storm of protest from consumer groups and politicians.
Read more...
• Bank chief predicts the end of the free bank account
• Banks under siege as 300,000 join campaign to refund bank charges
• Single mum wins back £23,000 in bank charges for friends and family
• Special Report: The end of free banking?
• Today's news headlines
The 2006 result showed the high street arm of Britain's third biggest bank made £86 profit for each of its 14 million UK customers. And it means Barclays directors are in line for bonuses of at least £15 million.
The profits were today condemned as " daylight robbery" by Eddy Weatherill, chief executive-of the Independent Banking Advisory Service. He said: "It's a complete stitch-up. They are the new highwaymen.
"The banks are having a heyday and they will continue to do so while customers sit still and don't look at what is being offered elsewhere."
The announcement comes ahead of a key report from the Office of Fair Trading into high bank charges, which many customers claim are illegal. However, Barclays chief executive John Varley said free banking was not under threat - contradicting comments from the head of Nationwide last night.
Mr Varley also revealed a big increase in bad debts to £2.15 billion, as tens of thousands of customers struggle with spiralling credit card debts and loans. However, he insisted the worst of the "debt crisis" at Barclaycard was over, saying: "The number of customers missing a payment is falling. Arrears balances are also falling."
But critics said the vast profits, equivalent to the gross domestic product in Jamaica, revealed how customers were being ripped off. Liberal Democrat Treasury spokesman Vince Cable said: "These enormous profits highlight the raw deal UK consumers are getting from banks.
"The Government's failure to get to grips with the banking sector means that while banks boost their profits, many customers are getting deeper and deeper into debt."
There was also criticism of the "underhand" charges levied on customers who go above their overdraft limit. Nick White, director of financial services at price comparison website uSwitch.com, said: "Consumers really need to keep a close eye on the sneaky changes made by their bank, more now than ever before." Barclays is the first of the big five high street banks to report its profits.
Its top boardroom pay-out will go to Bob Diamond, head of the hugely successful investment banking arm Barclays Capital.
However, Mr Varley defended the profits, saying they benefited pension funds and allowed the bank to support "thousands" of community projects around the world.
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