Barclays sets aside £150m for "anticipated economic uncertainty"

Stripping out litigation and conduct charges, profit before tax rose 20% to £5.7 billion.

The £2.2bn of charges in 2018 included a £1.4bn settlement with the US Department of Justice relating to residential mortgage-backed securities and PPI charges of £0.4bn.

The Bank's profit before tax increased from £1.7bn in 2017 to £2bn in 2018.

Laith Khalaf, senior analyst at Hargreaves Lansdown, commented: "After clearing the decks, the bank now needs to show what it can do unfettered by restructuring and litigation headaches.

"Last year headline profits were dented by large litigation costs, though these shouldn’t recur going forward. £1.4 billion was paid in a one-off settlement to the US Department of Justice, and while in theory PPI costs are still a live issue, 2019 is the last year that will be the case.

"Stripping out these costs, underlying profits rose 20%. This was in large part down to lower credit impairments in the international business, though these were largely one-off in nature too. Barclays has grown its loan book, but low interest margins means the top line is flat as a pancake. Costs are coming down though, and that’s helping to bolster profits.

"As with all the UK banks, Brexit casts a shadow over valuations, despite improving fundamentals. Indeed Brexit uncertainty has prompted Barclays to put aside £150 million in case of deteriorating economic conditions in the UK. That could prove to be insufficient or over-cautious, depending on proceedings in Westminster and Brussels. Therein lies the puzzle of the UK banking sector which explains lowly share prices; like Schrödinger’s cat, no-one’s quite sure what state it’s in."