Barclays - Once again hit by costs

Thursday, 2nd August 2018 09:57 - by Rajan Dhall

Revenues at Barclays have once again been hit by costs this quarter,  litigation costs hit the bank's profits, but excluding the charges, profits rose 20% to £3.7bn.

Summary:

• Q2 net profit before tax $2.5 bln
• Bank avoids fresh legal and conduct charges
• Interim dividend of 2.5 pence per share, above expectation
• Pre-tax profits fell from £2.3bn to £1.6bn after the bank paid out about £2bn, including a £1.4bn settlement with the US Justice Department.
• Pre-tax profits jumped by 20% to £3.7bn, with the UK arm seeing a 30% rise to £826m (without charges)
• Total income for the period was flat at £10.9bn.

So all in all, not the worst report from the bank and as complicated as always. Shares are said to be opening 2.5% higher (quoted by financial bookmakers). Looking at a longer-term view on the chart now you can see there is some traffic that could stall a potential move higher. Just above the 200p mark there is a strong trendline but having said that at 210p the market has traded the most shares at price. Today we may also see a rate increase from the BoE and this could help banking shares. Once we get a better understanding of all the regulatory issues it seems this stock offers good value and could move higher. 

The Writer's views are their own, not a representation of London South East's. No advice is inferred or given. If you require financial advice, please seek an Independent Financial Adviser.