Barclays set aside another £800 million (HK$9.5 billion) yesterday to cover potential settlements for alleged foreign exchange manipulation, hitting profits and reflecting its struggle to put past problems behind it. The bank said it had now set aside £2.05 billion to cover any settlement, after the extra provision to reflect "developments with certain authorities" since it last reported in March. "We are working hard to expedite their settlement," chief executive Antony Jenkins said, but the bank did not provide any more details on any potential deal. Barclays pulled out of a settlement between US and British authorities and six rival banks in November because it had not reached a deal with New York's regulator. It said it wanted to settle the allegations with as many agencies as possible in one go. New York's banking regulator said it could reach a deal with Barclays next month if it excluded a probe of the possible rigging of rates through computer programs. It could take several more months if that trading was included. Barclays also set aside another £150 million for compensating customer mis-sold insurance products in Britain, which has now cost Barclays £5.4 billion and all British banks more than £26 billion. The cost of settling past misconduct issues continues to dog Barclays' attempt to shift its focus away from investment banking and improve profitability. The bank reported a statutory pretax profit of £1.3 billion, down 26 per cent year on year. Its underlying pretax profit, stripping out the provision, was £1.8 billion, up 9 per cent year on year. Under Jenkins, Barclays has abandoned its ambition of being an investment banking powerhouse, shrinking its investment bank in favour of a return to its retail roots. He is cutting 19,000 jobs and shedding unwanted assets and businesses to cut costs and improve returns and its capital strength. Profits in the core business rose 14 per cent year on year to £2.1 billion, as earnings from personal and corporate banking rose 14 per cent and underlying costs fell 7 per cent. Return on equity, a key measure of profitability, was 10.9 per cent for the core business. The investment bank's profits rose 37 per cent on the year to £675 million, as revenues rose 2 per cent to £2.2 billion. "The investment bank had a good Q1, representing a performance which is more indicative of the potential of the franchise following the repositioning undertaken last year," Jenkins said.