Finance

Barclays shares up 6% as bank swings back to profit in first quarter amid strategic overhaul

Signage shines through a window reflecting Barclays head office in Canary Wharf, London, U.K.
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LONDON — Barclays on Thursday reported first-quarter net income attributable to shareholders of £1.55 billion ($1.93 billion), beating expectations and returning the British lender to profit amid a major strategic overhaul.

Analysts polled by Reuters had expected net profit attributable to shareholders of £1.29 billion for the quarter, according to LSEG data.

Pre-tax profits, however, were down 12% to £2.28 billion from $2.6 billion a year earlier, as the bank braces to implement its extensive revamp plans.

Here are some other highlights:

  • First-quarter group revenue was £6.95 billion, down 4% from the same period last year.
  • Credit impairment charges were £513 million, compared with £524 million in the first quarter of 2023.
  • Common equity tier one (CET1) capital ratio, a measure of bank’s financial strength was 13.5%, down from 13.8% in the previous quarter.
  • Full-year return on tangible equity (RoTE) was 12.3%.

Barclays reported a net loss of £111 million in the fourth quarter of 2023 due to an operational shake-up designed to reduce costs and improve efficiencies.

That included a £900 million hit from structural cost-cutting measures, which the bank said were expected to lead to gross cost savings of around £500 million in 2024, with an expected payback period of less than two years.

The overhaul saw the reorganization of the business into five operating divisions, separating the corporate and investment bank to form: Barclays U.K., Barclays U.K. Corporate Bank, Barclays Private Bank and Wealth Management, Barclays Investment Bank and Barclays U.S. Consumer Bank.

The bank also pledged to return £10 billion to shareholders between 2024 and 2026 through dividends and share buybacks.

This is breaking news. Please check back for updates.

— CNBC’s Elliot Smith contributed to this report.

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