Barclays (BARC) Q3 2024 earnings

LONDON – British bank Barclays on Thursday reported a profit of 1.6 billion ($2 billion) attributable to shareholders in the third quarter, beating expectations.

The result compared with a £1.17 billion profit forecast in an LSEG survey of analysts, and was 23% higher than the same period in 2023.

Revenue for the period came in at £6.5 billion, slightly ahead of the £6.39 billion forecast.

The borrower’s return on tangible equity rose to 12.3% from 9.9% in the second quarter, as its CET1 ratio – the solvency ratio – rose to 13.8% from 13.6%.

Earlier this year, Barclays announced a strategic overhaul in an effort to cut costs, increase shareholder returns and stabilize its long-term financial performance, focusing more on domestic lending while reducing costs in its sluggish investment portfolio. That strategy included the acquisition of UK retail banking business Tesco Bank.

In the second quarter, Barclays’ net profit fell slightly year-on-year amid lower income in its UK consumer bank and corporate bank, as net profit jumped 10% in its investment bank.

Those gaps were closed in the third quarter, with domestic banking income up 4%, when the lender raised its annual forecast for UK interest income to £6.5 billion from £6.3 billion. Corporate banking income was up 1% due to an increase in average deposit balances, while investment banking income gained 6%.

Barclays shares are up 55% year-to-date after dipping into 2023.

Several banks have announced plans to restructure, scale back operations and cut costs as they face a weakening net interest rate as interest rates fall. HSBC earlier this week it said it will consolidate its operations into four business units.

Deutsche Bank kicked off its third-quarter reporting season on Wednesday, posting a better-than-expected net profit as revenue in both its investment banking and asset management divisions jumped 11% year over year.

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