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Barclays' Q3 profits soar to £2.2bn, surpassing expectations with robust investment banking performance

The FTSE 100 bank reported a pretax profit of £2.2bn between July and September, up 18 per cent from £1.9bn a year earlier.

General view of a Barclays bank(Image: Mike Egerton/PA Wire)

Barclays' third-quarter profits exceeded predictions, thanks to a resurgence in its Wall Street investment banking operations. The FTSE 100 bank posted a pretax profit of £2.2bn for the period between July and September, marking an 18 per cent increase from £1.9bn the previous year.

Analysts had anticipated a third-quarter profit of around £2bn. The earnings boost was largely attributed to Barclays' investment bank, which saw a six per cent year-on-year income growth to £2.9bn, as reported by .

Investment banking income soared by 13 per cent due to higher fees in Barclays' advisory and debt and equity capital markets units. Income from global markets, fixed income and equities all rose by three per cent.

This strong performance mirrored that of rivals such as JP Morgan and Goldman Sachs, who also exceeded earnings estimates for the third quarter. Meanwhile, Barclays' º£½ÇÊÓÆµ bank demonstrated resilience amidst falling interest rates.

Total income for the business increased by four per cent, aided by Barclays setting aside just £16m for bad loans during the quarter a significant decrease from £59m the previous year. Its net interest income (NII) the difference between what it earns from loans and what it pays on deposits was six per cent higher at £1.7bn, aligning with estimates.

Barclays' net interest margin expanded by 30 basis points to 3.34 per cent as the bank navigated fierce competition for mortgages and deposits, spurred by expectations of further rate cuts from the Bank of England.

Barclays has updated its 2024 financial outlook, now anticipating a group net interest income (NII), excluding the investment bank and head office, to exceed £11bn, surpassing the previously projected figure of around £11bn.

The bank's º£½ÇÊÓÆµ division is forecasted to contribute approximately £6.5bn to the full-year NII, an increase from the earlier estimate of about £6.3bn.