Despite the credit squeeze, the bank increased spending on internal and client-facing technology

Barclays has revealed an increase in technology investment in 2007 despite experiencing a profit slump of around three per cent.

The bank's net profits slid to £4.4bn in 2007, compared to £4.6bn reported last year.

"The excellent results of the first half were achieved in a relatively benign environment; in the second half we were not immune from the impact of the credit market turbulence," said chief executive John Varley.

But operating expenses rose to £973m from £913m in the previous year, and this included improvements to infrastructure, such as upgrades of technology and operations platforms.

One of Barclays' technology highlights last year was the launch of its One Pulse smartcard, that combines contactless payment, credit card and travel features.

The card readers are already being used by London-based retailers such as Threshers, Yo Sushi, Eat, Krispy Kreme, Books Etc and the Science Museum.

A number of banks have followed the trend since, the latest being Lloyds TSB, currently working on a multimillion-pound contacless card project ahead of its aim to create a cash-free environment for the London Olympic Games.