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Highlights
Barclays Raises Net Interest Income Guidance: The bank has increased its full-year net interest income forecast following a strong third-quarter performance.
Profit Before Tax Increases: Barclays reported a profit before tax of £2.2 billion for the third quarter, marking an increase from the previous year.
Improved Return on Tangible Equity: The statutory return on tangible equity rose to 12.3%, indicating solid financial health and progress toward long-term goals.
Barclays (LSE:BARC) has raised its net interest income (NII) guidance for the full year after reporting a solid performance in the third quarter. The bank now anticipates that NII, excluding investment bank and head office activities, will exceed previous estimates, reflecting improved operational metrics. Specifically, guidance from the Barclays UK division has been adjusted upwards, indicating stronger income expectations.
In its third-quarter results, Barclays reported a profit before tax of £2.2 billion, an increase from £1.9 billion during the same period last year. This growth was supported by a 5% rise in group income, which reached £6.5 billion. The increase in Barclays UK income was 4%, driven by higher structural hedge income, although this was somewhat offset by mortgage margin pressures and challenges in deposit product dynamics. Notably, these adverse trends have shown signs of stabilization throughout the year.
Corporate banking income in the UK experienced a modest increase of 1%, while investment banking income rose by 6%. However, income from the private banking and wealth management division decreased by 3%, attributed to strong comparative results from the previous year.
Operating expenses remained consistent year-on-year at £4.0 billion, as efficiency measures successfully countered inflationary pressures. The bank's common equity tier 1 ratio stood at 13.8% by the end of September, aligning with the anticipated range for the year.
The statutory return on tangible equity reached 12.3% in the third quarter, up from 11% in the previous year, bringing the year-to-date RoTE to 11.5%. This positions Barclays well to exceed its benchmark for the upcoming year. The chief executive expressed confidence in the disciplined execution of the bank's three-year strategic plan, emphasizing the progress made towards achieving a return on tangible equity of greater than 12% by 2026.
