Barclays is betting on artificial intelligence to drive the next phase of its turnaround as the bank targets around £2 billion in cost savings and commits to returning more than £15 billion of excess capital to shareholders by the end of 2028.
Chief Executive Officer CS Venkatakrishnan, commonly known as Venkat, said the bank would target around £2 billion in gross efficiency savings over the next three years while increasing investment in technology, including AI, to improve productivity and customer experience.
“We will continue to invest to improve customer experiences and deepen relationships, while leveraging new technologies, including AI, to improve efficiency, build industry-leading businesses and drive further growth,” Venkat said.
The commitments are part of a series of new three-year targets announced alongside Barclays’ full-year results. They mark the next stage of a restructuring that has already led to a significant revaluation of the bank’s shares.
Under the plan, Barclays expects to return more than £15 billion of excess capital to investors by the end of 2028, reflecting greater profitability and capital generation across the group.
The announcement comes two years after Venkat launched an overhaul of Barclays aimed at reducing reliance on its volatile investment banking division and reorienting the business towards more stable revenues from its UK retail, corporate and retail banking businesses.
This strategy suffered setbacks on the M&A front. Barclays lost out to Santander UK in the £2.65bn auction for TSB last summer and was beaten by NatWest in the race to buy asset manager Evelyn Partners for £2.7bn earlier this week.
Despite these disappointments, the turnaround was well received by investors. Shares in Barclays have risen around 240 percent in the last two years, one of the strongest performances among major British banks.
The group’s annual results underline this dynamic. Pre-tax profits rose 13 per cent to £9.1bn last year, well above City analysts’ forecast of £9bn.
Barclays also announced a return on capital of £1.8bn for the year, including a full-year dividend of £800m – equivalent to £5.6bn per share – and up to £1bn from a share buyback.
With its initial restructuring largely complete, Barclays is now betting that tighter cost controls and smarter use of AI can sustain growth, improve earnings and consolidate the recovery as competition intensifies in the UK and global banking sectors.
