BARCLAYS delivered the first slice of £25bn in profits expected to be announced by the UK's biggest banks during the next month.

The group, whose chief executive Matt Barrett recently admitted that credit cards were too expensive, announced a 20 per cent rise in 2003 pre-tax profits to £3.84bn.

One of the strongest performances came from Barclaycard, which increased operating profits 17 per cent to £722m.

In the coming weeks, City analysts expect Royal Bank of Scotland, HSBC, Lloyds TSB and HBoS to contribute another £21bn in profits for 2003.

Improved economic conditions and lower levels of bad debt helped lift profits, although the Barclays also said it benefited from targets it set four years ago.

The main goal - to produce shareholder returns that matched the top 25 per cent of its banking rivals - was achieved, but Barclays said it was £800m short of its £6.1bn target for cumulative economic profit in the four-year period.

The company, which has more than 2,000 UK branches and 74,800 employees, said it was the ninth largest bank in the world ranked by market value.

Mr Barrett said: "These are strong results, which demonstrate the momentum we have generated over our first four-year goal period.

"We embark on the next four-year goal period with confidence and commitment to further enhance performance."

Barclays said operating income last year increased ten per cent to £12.41bn, with provisions for bad or doubtful debts down nine per cent to £1.35bn.

Yesterday's results announcement will be the last as chief executive for Mr Barrett as he is due to become Barclays chairman at the end of this year.

He will be succeeded by John Varley, who recently became deputy chief executive.

Mr Barrett was appointed to Barclays in October 1999 as the group sought to revive investor confidence in the wake of a profits warning.