Barclays profits have been hit by a previously announced £1bn provision for compensating customers mis-sold payment protection insurance.

The banking giant’s half year results, announced this morning, show a profit of £2.6bn, down 33% compared to this time last year. Pre-tax profits in Barclay’s retail and business banking division fell 63% to £446 million, which included the PPI hit.

Barclays announced in May that it was providing £1bn to compensate customers mis-sold PPI following the British Bankers Association’s decision to drop its legal challenge of the way the FSA and the Financial Ombudsman Service were handling such claims.

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