But there was good news for IFP-sponsor Barclays Wealth where profits before tax grew 27 per cent from £163m to £207m and total income grew 12 per cent, from £1.5bn to £1.7bn.

Barclays’ chief executive Bob Diamond said: “Barclays universal banking model continues to be a competitive strength.  Revenues remained resilient overall, reflecting the strength of our customer franchise and the balanced mix of our business.”

The firm also announced it had cut its bonus pool by 25 per cent to £2.2bn and capped individual bonuses at £65,000.

Further bonus cuts were made to investment banking division Barclays Capital which saw poor results. Profit before tax was down 32 per cent from £4.3bn to £2.9bn and total income was down 22 per cent from £13.2bn to £10.3bn.

Barclays Capital’s return on equity fell to 5.8 per cent from 7.2 per cent a year ago, less than half of the firm’s 13 per cent target.

Mr Diamond said: “We are not satisfied with the return on equity we delivered in 2011 and are committed to delivering steady improvement moving forwards.”

Further details will be given in the firm’s annual report which will be published in March.