Barclays’ half-year profit rises but cover for bad loans soars to £900m
The banking giant said its pre-tax profit hit £4.6b n in the six months to the end of June, up from £3.7 bn the same time last year.
The previous year it had suffered a hit from a trading blunder in its US structured products division.
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Hide AdThe multinational bank’s second-quarter profit also beat market expectations at £2 bn, ahead of the £1.9bn expected by analysts.
However, like rival lender Lloyds Banking Group, it marked a slowdown from the previous quarter, which saw a record-high £2.6bn profit.
The mammoth credit impairment charge of £900m is more than double the amount set aside last year.
Barclays said the charge reflects higher interest rates, which have pushed up the cost of borrowing, higher credit card balances in the US, and “normalising delinquencies” – which means customers falling behind on their debts.
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Hide AdFurthermore, it saw a decline in activity in its corporate and investment bank division amid greater market volatility.
Group chief executive CS Venkatakrishnan said: “We have positioned Barclays carefully for this mixed macroeconomic environment and delivered a consistent performance in the second quarter.
“Looking forward, we are very confident of meeting our targets for the full year.”