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London — Barclays expects to take a write-down of about £1bn on its annual post-tax profit as a result of the US tax overhaul, the bank said in a statement on Wednesday.

The reform to the tax system signed into law by US President Donald Trump on December 22 will force the British lender to reduce the value of its deferred tax assets, prompting it to take a once-off charge in its results for the 12 months to the end of December.

It will also lead to the bank’s common equity Tier 1 capital ratio, a key measure of its financial strength, falling by about 20 basis points, the lender said.

Since taking the helm at Barclays in December 2015, CEO Jes Staley has streamlined the bank into a transatlantic lender focused on the US and Britain.

The restructuring has led it to exit a raft of non-core operations, such as its business in Africa and units in Asia, in a bid to simplify its structure and boost returns to shareholders.

Barclays already slumped to a £628m attributable loss in the nine months to the end of September following write-offs in the wake of its exit from Africa.

The £1bn charge to account for the US tax changes is expected to push it further into the red.

The $1.5-trillion tax overhaul is the biggest reform of the US tax system since the 1980s and will see its corporate tax rate slashed to 21% from 35%. While Barclays said the reduction in the tax rate is expected to “positively impact” its future post-tax earnings in the US, it also cautioned that the base erosion anti-abuse tax (BEAT), which was included in the legislation and designed to prevent multi-national firms from abusing the tax code, could significantly offset that benefit.

The bank added: “Due to the uncertain practical and technical application of many of these provisions, it is currently not possible to reliably estimate whether BEAT will apply and, if so, how it would impact Barclays.” — Reuters.