Barclays is saving money and improving its customer experience through technology investments. 

Total operating expenses for its investing banking arm were 7.7 billion pounds ($9.4 billion) in 2023, down 6% from 2022, reflecting that investment in talent and technology were driving down costs, according to the bank’s fourth-quarter earnings presentation.  

The $1.7 trillion bank aims to continue “investing in digitization, automation and technology [to] deliver material efficiencies,” along with improving customer experience, Chief Executive C.S. Venkatakrishnan said today during the bank’s Q4 earnings call. 

BIGGER PICTURE: Barclays peers NatWest and Citi are also saving money with tech investments. 

NatWest reported in its Feb.16 Q4 earnings report that it has saved $315 million since 2021 by digitizing customer experience. 

Citi announced last month that it aims to reduce its workforce by 10% through 2026 and aims to use technology to eliminate stranded costs. 

BY THE NUMBERS: In Q4, Barclays reported; 

• Total income of $6.9 billion, down 3% year over year; 
• Total staffing costs of $12.6 billion, up 8% YoY; 
• Total operating expenses of $6.2 billion, up 23% YoY; and 
• Net interest income of $3.9 billion, down 2% YoY. 

NOTEWORTHY: On Feb. 9, Barclays announced that it had agreed to acquire retail giant Tesco’s consumer banking operations for $757 million. 

The “strategy is to strengthen [Barclay’s] retail business in U.K., as they are acquiring a healthy customer base and expanding the audience they can reach,” Agustin Rubini, director analyst at think tank Gartner, told BAN. This expands the bank’s service offering and customer touchpoints, he said.  

Banking chief executives’ priorities changed in 2023, with 22% making M&A a priority for their operations last year compared with 19% in 2022, Rubini said, adding that the trend is expected to continue in 2024.  

This year, financial services might experience a wave of mergers and acquisitions as uncertain macroeconomic conditions and a high-rate environment weigh heavily on businesses, James White, general manager of banking industry at fintech Total Expert, told Bank Automation News. M&A activity will also help FIs bolster their offerings and expand their consumer base, he said. 

Capital One also announced today that it aims to acquire card payment network company Discover Financial Services for $35 billion.  

FUTURE LOOK: Seventy-five percent of Barclays’ operations are on the cloud, and the bank aims to move 85% to 90% of its workload to the cloud along with decommissioning 450 to 500 legacy applications in the coming quarters, Venkatakrishnan said.  

The London-based bank aims to improve customer experience by modernizing its platform and reducing legacy technology, according to its earnings statements. 

In Q4, the bank reported that 98% of its interactions with customers were digital, including ATM branch self-service devices, a mobile app and online banking.  

The bank also aims to roll out its AI digital assistant to more consumers to improve customer experience, according to its earnings presentation. 

Editor’s Note: All figures converted to USD. 

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