Barclays beats earnings estimates and increases shareholder payments

The Barclays and HSBC buildings are seen in in the midst of the epidemic of coronavirus disease (COVID-19), in London, Great Britain, October 20, 2020.

Matthew Childs | Reuters

LONDON – Barclays beat second-quarter profit expectations on Wednesday and higher returns for shareholders, with the publication of its investment banking activities and shares record income.

The British lender posted an attributable quarterly profit of £ 2.1 billion ($ 2.9 billion), up £ 90 million for the second quarter of 2020. Analysts expected net declared income of 1.7 billion pounds for the three months to the end of June, according to Refinitiv data.

Equity and investment banking fees were up 38% and 27%, respectively, in the second quarter.

Barclays also announced greater distributions of capital to shareholders, with a half-year dividend of 2 pence for share and another share buy back of up to 500 million pounds.

The bank has also saw a significant reduction in provisions for credit losses, as indicated in his first-quarter earnings report, and managed to free nearly £ 800 million from its credit depreciation provisions compared to the £ 1.6 billion burden incurred for the same period of 2020.

“Our profitability, strong capital position and balance sheet have made it possible us increase capital distributions to shareholders, “said CEO Jes Staley in a statement, adding that the bank is seeing a rebirth in activities between its companies.

“Our CIB (corporate and investment banking) business is well positioned to benefit from continuing growth in debt and equity capital markets, with Commission revenue from global markets and investment banking up 36% from 2019 and our strong retail businesses are poised to support and benefit from a consumer recovery. “

Barclays shares earned 4.7% in soon trade.

Other highlights for the quarter:

  • Group turnover hit £ 5.4 billion, in fraction up from £ 5.34 billion a year does.
  • CET 1 ratio, one measure of bank solvency, he came in at 15.1%, up from 14.2% to year does.

The fixed income, currencies and materials prime (FICC) trading business era down 37% in all the first half of the year compared to a bumper first half of 2020, as induced by the coronavirus market volatility led to spike in trading volumes.

Barclays has previously indicated that it expects the costs rise in 2021 compared to the previous one year, due to the expenses related to the coronavirus, a real property review, further structural cost action and wage increases.

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