Shares of U.K. bank Barclays fell Tuesday after it announced further restructuring, a dividend cut and an 8 percent fall in statutory pre-tax profit last year to £2.1 billion ($2.9 billion).
As part of its full-year results, Barclays announced that it will be simplifying its business structure to two sibling divisions: Barclays U.K. – which will become a U.K. ring-fenced bank – and Barclays Corporate and International. As part of the restructure, Barclays is looking to sell down its 62.3 percent holding in its African business.
"The challenge we need to do is wind down our non-core assets as we simplify Barclays business model," chief executive Jess Staley told CNBC Tuesday. He added that the bank also needed to "put our conduct and litigation issues behind us."
The bank also issued a full-year dividend of 6.5 pence per share for 2015 but announced it was cutting the dividend to 3 pence a share in 2016. London-listed shares of the bank fell 9 percent on Tuesday and were briefly halted during the morning session.
Staley said closing the bank's non-core business was a key to success and defended the dividend cut.
"We've got plenty of capital and like our capital position. We are cutting the dividend for a very simple reason – we need to accelerate the closure of our non-core business."
"Clearly cutting the dividend was a very painful decision...but it was necessary to make sure we were unfettered in getting that non-core business down in 2016," he said.
Barclays has seen its share price fall over 30 percent over the last two years amid a tumultuous period of changing leadership and restructuring. Staley said the size of the bank's non-core assets and the expense of getting out of them had dented investor confidence.
"If we can convince the market that we're done with non-core and there's true visibility to the earnings power of Barclays, the stock will recover and we'll be in a very good position," Staley said,