Barclays said it had cut £22 billion of risk weighted assets from its bad bank in the first six months of the year.
The British bank said it made a net profit of £161 million ($272. 1 million), compared with a net loss of £168 million in the same period last year.
Pretax profit at Barclay's fixed income, currencies and commodities division, nearly halved compared with the same period last year to £567 million.
The weak performance at the investment bank was partially offset by a jump in pre-tax profit at the bank's personal and corporate banking division and Barclaycard credit card unit.
Earlier this year Barclays also created a "bad bank" division consisting of £115 billion of assets not profitable enough to keep.
The regulatory blow came as the bank said it swung to a net profit in the second quarter but the lender's results were weighed down by slowing revenues at its investment bank and a huge provision for wrongfully sold payment protection insurance.
Barclays is currently undergoing a radical transformation to turn it into a leaner bank, which doesn't depend so heavily on its investment bank to generate the bulk of its profit.
They include all of its European retail-banking assets and some parts of the investment bank, as well as other assets no longer considered core to the bank's business.
However, shares rose 5 per cent in early London trading as pre-tax profit, which rose to £689 million from £142 million in the quarter, beat analysts expectation.
The bank's results were hit by a £900 million provision to compensate customers wrongly sold payment protection insurance.
Barclays PLC is under renewed pressure in the US after it disclosed on Wednesday that authorities extended a pact known as a "nonprosecution agreement" to cover a continuing investigation into alleged foreign-exchange manipulation.
In May the UK lender said it would cut 7,000 jobs at its investment bank by 2016, part of efforts to trim 19,000 positions across all the bank's divisions over the next three years.
Read more here: Business Spectator