Barclays profits surge
Barclays Plc, Britain's third biggest bank, said it was through the worst of its bad debt troubles as it narrowly beat expectations with a 35 per cent jump in 2006 profits, helped by one-off gains from disposals.The bank's booming investment banking...
Barclays Plc, Britain's third biggest bank, said it was through the worst of its bad debt troubles as it narrowly beat expectations with a 35 per cent jump in 2006 profits, helped by one-off gains from disposals.
The bank's booming investment banking and fund management businesses spearheaded the rise but Barclays said it was also encouraged by a recovery in UK mortgages and retail banking.
Barclays reported record yearly pre-tax profit of £7.14 billion - including 323 million of exceptional gains on disposals. That compares with £5.28 billion a year earlier and an average 2006 forecast of 7.01 billion based on 18 analysts polled by Reuters Estimates.
Group income rose 25 per cent to £21.6 billion, slightly below forecasts, but outpacing a 20 per cent rise in operating costs to 12.7 billion.
Bad debt troubles have weighed on Barclays as UK borrowers struggle to pay back loans at its Barclaycard credit card unit and the bank said its impairment charge rose 37 per cent from 2005 to £2.15 billion.
But that was marginally better than expected and the bank said it believed it had "passed the worst" in Barclaycard UK's impairments in the second half of last year. Barclaycard's profits fell 40 per cent to £382 million.
"Arrears are down, the number of customers falling into arrears is down, but the environment is still quite difficult," outgoing finance director Naguib Kheraj told reporters.
Barclays plans to accelerate its international retail expansion and will open about 350 branches overseas this year, targeting Portugal, Spain, Italy, India, UAE and Africa.
It said it invested £2 billion on organic growth last year, including opening 100 overseas branches to increase its international footprint to over 1,500 branches.
Profits at the Barclays Capital (BarCap) investment banking arm jumped 55 per cent to £2.22 billion, while BGI reported a 32 per cent rise to 714 million. Other UK high street banks are also expected to report record profits, rekindling arguments in the UK on bank charges.
The bank's booming investment banking and fund management businesses spearheaded the rise but Barclays said it was also encouraged by a recovery in UK mortgages and retail banking.
Barclays reported record yearly pre-tax profit of £7.14 billion - including 323 million of exceptional gains on disposals. That compares with £5.28 billion a year earlier and an average 2006 forecast of 7.01 billion based on 18 analysts polled by Reuters Estimates.
Group income rose 25 per cent to £21.6 billion, slightly below forecasts, but outpacing a 20 per cent rise in operating costs to 12.7 billion.
Bad debt troubles have weighed on Barclays as UK borrowers struggle to pay back loans at its Barclaycard credit card unit and the bank said its impairment charge rose 37 per cent from 2005 to £2.15 billion.
But that was marginally better than expected and the bank said it believed it had "passed the worst" in Barclaycard UK's impairments in the second half of last year. Barclaycard's profits fell 40 per cent to £382 million.
"Arrears are down, the number of customers falling into arrears is down, but the environment is still quite difficult," outgoing finance director Naguib Kheraj told reporters.
Barclays plans to accelerate its international retail expansion and will open about 350 branches overseas this year, targeting Portugal, Spain, Italy, India, UAE and Africa.
It said it invested £2 billion on organic growth last year, including opening 100 overseas branches to increase its international footprint to over 1,500 branches.
Profits at the Barclays Capital (BarCap) investment banking arm jumped 55 per cent to £2.22 billion, while BGI reported a 32 per cent rise to 714 million. Other UK high street banks are also expected to report record profits, rekindling arguments in the UK on bank charges.