British bank Barclays Plc has announced plans to cut 5,000 jobs, or about 5% of its total workforce, as part of a wider effort to reduce costs and improve efficiency using technology and artificial intelligence (AI).
The bank is focusing on simplifying its organisation and making its operations more efficient, according to Barclays’ third-quarter earnings statement.
Barclays’ investment bank reported total income of £3.13 billion in the third quarter, slightly below expectations. Group income stood at £7.4 billion, compared with analysts’ estimate of £7.61 billion, according to CNBC. Barclays’ pre-tax profit increased 12% year on year to £2.3 billion ($3.1 billion) in the third quarter, matching forecasts compiled by LSEG. The bank’s net interest income remained broadly unchanged at £3.91 billion, according to CNBC. The bank reduced costs by £201 million in the three months through September. It plans to cut costs by a further £300 million in the final quarter of 2026.
Barclays Chief Executive Officer CS Venkatakrishnan said the bank plans to use AI on a large scale but stressed that the technology is only one part of its cost-cutting strategy. “We will employ AI at scale,” he said. Venkatakrishnan made these remarks during a call with reporters, according to Bloomberg.
“But AI is the icing on the cake, not the cake. The bank’s results missed several analyst estimates, with weakness in its investment banking business offsetting stronger performance in some other areas. The bank’s bond traders recorded a particularly sharp decline in performance during the quarter, while its equities trading business delivered strong growth. The bank’s overall group income also came in below forecasts, despite an increase in pre-tax profit. However, the bank’s performance varied across its businesses, with weakness in investment banking affecting the overall results. The additional savings are part of Barclays’ continuing drive to lower expenses and create more room for investment.
The announcement came as Barclays reported its third-quarter earnings on Thursday.
Venkatakrishnan described the investment bank’s FICC performance as “somewhat disappointing” during a call with reporters. The weakness in bond trading reduced the impact of a strong performance in equities, where revenue increased significantly during the quarter.
