Barclays quarterly profit nearly triples
The UK is on the verged of the largest economic boom since the post-World War Two era, according to the chief executive of Barclays Jes Staley.
Staley’s positive outlook came as the FTSE 100 bank confirmed its profits for the first quarter of the year had more than doubled compared to the year before to £2.4bn.
“We estimate the UK economy will grow at its fastest rate since 1948. That’s pretty spectacular,” he said.
The vaccination roll-out, as well as pent-up savings, will be the biggest drivers of the recovery.
Staley said that an additional £200bn is being held in customer and company bank accounts which means that the UK, along with America, is likely ti see some of its most rapid growth in decades.
The rise in Barclays’ profits was largely down to increased optimism over how its loans would be repaid.
Around this time in 2020 Barclays put aside around £2bn as an insurance in the event that borrowers would default on their debts, however, they are now setting aside £55m in a show of increased confidence.
“It may be boom time for the UK economy according to Barclays chief executive Jes Staley but not for the company itself judging by the reaction to its latest trading update,” says Russ Mould, investment director at AJ Bell.
“The decision not to adjust its previous bad debt estimates, unlike most of its peer group, appears to have spooked the market along with a patchy investment banking performance and a cautious view on costs as Barclays looks at reducing its physical footprint.”
“Less of us seem to be splurging with our credit cards in lockdown judging by the performance of Barclaycard, perhaps because of belt tightening on one side and on the other because some people have built up a cash buffer and therefore don’t need to use credit at a time when there’s less to spend on.”