Barclays plots cuts as provisions for bad debts hit £4.3bn

3 min read
Lorem ipsum dolor sit amet,sed diam nonumy eirmod tempor invidunt ut labore et dolore magna aliquyam erat, At vero eos et accusam et justo duo dolores et ea rebum. Lorem ipsum dolor sit amet, no sea takimata sanctus est Lorem ipsum dolor sit amet. Stet clita kasd gubergren, no sea takimata sanctus est Lorem ipsum dolor sit amet. no sea takimata sanctus est Lorem ipsum dolor sit amet. no sea takimata sanctus est Lorem ipsum dolor sit amet. sed diam voluptua.

Barclays has warned it is evaluating cost-cutting measures after raising provisions for bad loans during the coronavirus crisis to date to £4.3bn.

The bank reported that third quarter group profit before tax came in at £1.1bn after booking charges of £608m in the July to September period.

It had previously revealed provisions of £3.7bn covering the first half of the year as the COVID-19 crisis rocked the global economy – also forcing the bank and its UK rivals to the front line in the provision of emergency government-backed loans to business customers.

Barclays said that it had also provided over 640,000 payment holidays globally and foregone “some £100m” in the form of waived overdraft interest and banking charges for UK customers and business banking clients.

“We have now delivered some £25bn through the government support measures to UK businesses”, the bank added.

But its statement warned that it was evaluating actions to reduce structural costs.  The bank said no decisions had been taken as the pandemic continues to cloud the path ahead, with record low interest rates hitting margins.

Chief executive Jes Staley told financial analysts that the prospect of the Bank of England introducing negative interest rates in any persistent economic downturn would be “very tough” for banks – putting pressure on profitability.

However, he said that such a course could be of benefit, if it boosted spending in the economy.

He also failed to rule out bonuses for the full year despite dividends to shareholders being suspended.

Barclays said that despite the weak rate environment, its consumer-facing businesses returned to profit in the period.

Barclays UK delivered profit before tax of £196m. The bank credited lower impairment charges and a limited recovery in economic activity.

The consumer, cards and payments division was in the black to the tune of £165m, Barclays said.

Its investment bank continued to be the darling for earnings, with the markets division delivering a 29% leap in revenue to £1.7bn.

Shares rose 4% at the open and climbed throughout the session with rival bank shares also benefiting on the better than expected performance.

Mr Staley told investors: “In this historically challenging year for our customers and clients we have continued to provide huge support to help people through the social and economic impact of the COVID-19 pandemic.

“This remains a priority, alongside maintaining the financial integrity of the firm and keeping our colleagues safe.”

Mr Staley has been a cheerleader for the investment bank under pressure from some investors for a renewed shrinking of the more risky division.

Neil Wilson, chief market analyst at, said of the Barclays results: “A strong performance at the corporate and investment bank lifted Barclays to a significant Q3 pre-tax beat.

“Profits before tax of £1.15bn was about twice what was expected by the market.

“Much like its bigger Wall Street cousins the investment banking division is offsetting a weaker performance in the consumer bank. Sticking with the investment bank was the best thing Barclays could have done.”

Barclays is the first of the major UK banks to report on their progress during the summer months.

Next week sees Lloyds, HSBC and RBS reveal their respective updates.

3 thoughts on “Barclays plots cuts as provisions for bad debts hit £4.3bn

  1. I am commenting to let you know of the fine encounter my friend’s daughter found reading your site. She figured out many issues, not to mention what it’s like to have a wonderful giving mindset to have men and women quite simply have an understanding of selected hard to do subject areas. You really exceeded our expectations. Many thanks for giving the insightful, safe, informative as well as unique tips on your topic to Mary.

  2. Thank you for your entire labor on this web site. My mom really loves managing investigations and it is obvious why. My partner and i learn all regarding the lively tactic you present sensible techniques through your web site and in addition invigorate response from some others on the situation then our favorite princess is really starting to learn a whole lot. Take advantage of the rest of the year. You have been doing a stunning job.

Leave a Reply

Your email address will not be published.