Barclays plans 5,000 job cuts as bank steps up AI adoption

Barclays plans to axe 5,000 jobs this year, with developers bearing the brunt of the cuts as the UK bank adopts AI across its operations.

The cuts equate to about 5 per cent of Barclays’ workforce, the bank said on Thursday, and are part of a broader cost-cutting programme.

Barclays said it had cut 1,000 jobs in the first half of the year as part of its restructuring, which includes staff reductions, investments in technology and a broader overhaul its operations.

“We will employ the AI at scale but AI is the icing on the cake not the cake,” the bank’s chief executive CS Venkatakrishnan said.

Barclays said it has spent £307mn on the overhaul in the first nine months of the year and expected to incur another £300mn in restructuring costs by the end of 2026.

The announcement came as Barclays reported £2.3bn in pre-tax profits for the third quarter, a 12 per cent increase from last year, but a weak performance from its fixed income business meant the bank failed to meet City expectations.

The rise in profit fell short of analysts’ expectations of £2.42bn for the three months to September, while revenues also disappointed, climbing only 3 per cent year on year to £7.4bn.

Banks’ profits have been boosted by a period of higher interest rates, sparking fears in the industry that they could be hit with a tax increase in UK chancellor John Healey’s first Budget next week.

Income from Barclays investment bank was flat, as profits from fixed income traders were down 19 per cent year on year. That was partially offset by better performance at the investment bank’s equities division, which had its best quarter in more than a decade and brought in £1bn in revenues.

Barclays attributed the near 50 per cent jump in equities income to investment in its prime brokerage.

The bank’s operating costs rose 6 per cent, which the bank said reflected business growth and some additional payments to high performers.

“I am pleased with the ongoing momentum of Barclays’ operational and financial performance,” said Venkatakrishnan.

Shares in Barclays fell 2 per cent in early trading on Thursday.