Barclays joined other lenders in announcing sizeable returns to shareholders after performing ahead of expectations in the second quarter.
In the three months to June, Barclays reported a pretax profit of £1.9bn, more or less unchanged on last year but comfortably ahead of the £1.6bn expected by analysts.
The lender’s investment bank and its wealth management division were the star performers, with income rising ten per cent and seven per cent respectively.
In its wealth management division Barclays reported the continued benefits from the higher rate environment and “client balance growth”. Within investment banking, meanwhile, equities income jumped 24 per cent helping to offset weakness in the bank’s fixed income team.
It is the only domestic UK bank that still has a global dealmaking arm, although some analysts argue that it should reduce the size of its team.
Income from Barclays UK, its domestic retail bank, fell four per cent due to pressure on mortgage margins and the cost of deposits.
On the back of its results, Barclays announced a half year dividend of 2.9p per share alongside a £750m share buyback programme, totalling a £1.2bn distribution for the first half.
Between now and 2026 it plans to return at least £10bn to shareholders through dividends and share buybacks.
“We are making good progress on our three-year plan,” boss CS Venkatakrishnan said. “We completed the sale of the performing Italian mortgage book, announced the sale of the German consumer finance business, and are on track to complete the acquisition of Tesco Bank in November 2024,” he added.
Barclays is in the process of fully exiting European retail banking outside of the UK as part of a wider restructuring designed to cut costs and boost shareholder returns.
Looking forward Barclays raised its net interest income guidance from around £10.7bn to around £11bn, largely due to interest rates remaining higher for longer. A large part of this increase will come thanks to higher than expected revenue from the bank’s UK division.