Barclays quarterly profit more than doubles as investment bank fees surge

Barclays’ income better than doubled inside the third quarter pushed by one different sturdy effectivity from its funding monetary establishment, whereas the affect of coronavirus on its consumer divisions continued to recede.

Web income jumped to £1.45bn from £611m within the an identical interval last 12 months, Barclays said on Thursday, beating analysts’ expectations of £1.1bn. Revenue rose 5 per cent to £5.47bn, in distinction with the £5.2bn estimate.

Part of the surge in internet income was attributable to a drop in new loan-loss provisions. They fell to £120m in distinction with £608m inside the third quarter last 12 months, when the monetary establishment was compelled to place apart additional to cowl potential unhealthy loans attributable to coronavirus lockdowns.

Barclays added that it expects impairments to remain lower than widespread as unsecured borrowing by financial institution card prospects is subdued and because of “improved macroeconomic outlook”.

The funding monetary establishment had one different good quarter, notably in capital markets and M&A, the place costs elevated 59 per cent to £971m common, similar to the big gains posted by Wall Street rivals last week.

Revenue from M&A advisory surged to £253m inside the quarter from £90m last 12 months because the worldwide dealmaking enhance continued, whereas equity and debt capital markets every posted options.

Equity shopping for and promoting elevated 10 per cent, nevertheless there was a 20 per cent plunge in fixed-income shopping for and promoting income as market volatility returned to common following the pandemic chaos of mid-2020.

Whole pre-tax earnings on the funding banking unit rose 51 per cent to £1.5bn, beating estimates for £1.1bn.

Barclays chief authorities Jes Staley said “whereas the funding monetary establishment effectivity continues to be an house of energy, we’re moreover seeing proof of a consumer restoration and the early indicators of a additional useful price ambiance”.

Pre-tax earnings on the UK retail banking enterprise rose to £451m from £196m attributable to a mixture of lower impairment charges and higher costs from rebounding purchaser train.

Nonetheless, Staley moreover warned that the lender is planning “structural worth actions sooner than the tip of the 12 months”, notably in its dwelling market, with out providing particulars on division closures or job cuts.

Citigroup analyst Andrew Coombs said: “Whole an outstanding set of numbers, albeit pushed by a file quarter for funding banking advisory revenues, so the beat may not be completely extrapolated into future quarters.”