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Barclays has bounced back into the black with an annual net profit of £1.62bn, helped by a sharp fall in conduct and litigation charges and a surge in investment banking revenues.

Jes Staley, who has been Barclays chief executive for just over a year, said: “We are now just months away from completing the restructuring of Barclays, and I am more optimistic than ever for our prospects in 2017, and beyond.”

Mr Staley has taken a contrarian bet by “doubling down” on the future of Barclays’ investment bank at the expense of scaling back to focus on the US and UK while selling its large African operations and cutting the dividend in half.

Overall the bank’s revenues declined 3 per cent to £21.5bn, while pre-tax profits almost trebled to £3.23bn. It shifted from a net loss of £394m in 2015 to a net profit of £1.62bn. It cut the dividend from 6.5p per share to 3p.

The bank’s international unit, which includes its investment bank, increased its pre-tax profits from £2.3bn to £4.1bn, while revenues rose by 9 per cent to £15bn. The bonus pool was cut by 1 per cent to £1.53bn.

Meanwhile, pre-tax profits at its UK unit, which includes the main British high street bank, more than trebled to £1.74bn and revenues were up 2 per cent at £7.5bn.

Total conduct and litigation costs at the group were down 69 per cent at £1.36bn.

In the fourth-quarter the bank’s core fixed income, currencies and commodities trading operations increased revenues year-on-year by a third from £577m to £766m.

That lagged behind its five biggest US rivals, which reported a 44 per cent surge in revenues from their fixed income, currencies and commodities trading arms in the last three months of 2016.

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