Barclays is leveraging artificial intelligence to drive the next stage of its turnaround, targeting approximately £2 billion in cost savings and pledging to return more than £15 billion of surplus capital to shareholders by the end of 2028.
C.S. Venkatakrishnan, the chief executive known as Venkat, announced the bank’s intention to achieve around £2 billion in gross efficiency savings over the next three years. This will be accompanied by increased investment in technology, including AI, to enhance productivity and customer experience. Venkat stated, “We will invest further to improve customers’ experience and deepen relationships, while harnessing new technology, including AI, to improve efficiency and build segment-leading businesses and drive further growth.”
These goals are part of a new set of three-year targets revealed alongside Barclays’ full-year results, marking the next phase in a restructuring that has already led to a significant re-rating of the bank’s shares. Barclays plans to return over £15 billion of excess capital to investors by 2028, reflecting stronger profitability and capital generation across the group.
The announcement follows two years after Venkat initiated an overhaul of Barclays to reduce its dependence on the volatile investment banking sector and shift the focus towards more stable earnings from UK retail, corporate, and private banking. This strategy has encountered challenges in mergers and acquisitions, with Barclays losing out to Santander UK in the £2.65 billion auction for TSB and more recently to NatWest in the bid to acquire wealth manager Evelyn Partners for £2.7 billion.
Despite these setbacks, the turnaround has been positively received by investors, with Barclays shares rising by approximately 240 per cent over the past two years, marking one of the strongest performances among major UK banks. The group’s annual results highlighted this momentum, with pre-tax profits rising 13 per cent to £9.1 billion last year, exceeding the £9 billion forecast by City analysts.
Barclays also announced £1.8 billion in capital returns for the year, including an £800 million full-year dividend, equivalent to 5.6p a share, and up to £1 billion through a share buyback. With its initial restructuring largely complete, Barclays is now focusing on tighter cost control and the strategic use of AI to sustain growth, improve returns, and solidify its recovery amidst increasing competition in UK and global banking.
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