The week ahead: US rate decision; Tesla, BP, Lloyds, Barclays results...24 Apr 2021 09:37
Barclays Q1 results
Friday: Barclays has been one of the better performers for UK bank shareholders over the last year. Earlier this month the bank reversed all its post-pandemic declines, hitting its highest levels since late 2019 on the back of rising optimism over the health of the UK economy, as well as the outperformance of US investment banks and their recent strong numbers. As one of the few UK banks with an investment banking division, the failure of activist shareholder, Ed Bramson, to force the slimming down of the business has resulted in a much better outcome for the bank, given the recent increases in volatility and steepening of the yield curve. This hasn’t stopped Bramson from continuing to bang that particular drum, however he’s on much shakier ground by suggesting the bank goes down the Deutsche route, given the litany of problems there. Whatever his views about trading businesses in general, managed correctly they have helped the larger banks operate a diverse business model, as well as increase profitability.
This was reflected in its last set of numbers, when Barclays reinstated the dividend with a 1p payout as well as a ÂŁ700m share buyback, despite setting aside over ÂŁ4.8bn in non-performing loans. Pre-tax profit for 2020 fell to ÂŁ3.1bn from ÂŁ4.4bn, while investment bank profit rose to ÂŁ4bn. CEO Jes Staley was also bullish about 2021, citing the prospects for the economic reopening. With US banks rotating capital out of their loan loss provisions, banks in the UK do something similar. Barring a setback in the form of a new variant or another lockdown, the outlook looks much brighter now than it did at the beginning of the year.
https://www.cmcmarkets.com/en-gb/news-and-analysis/the-week-ahead-us-rate-decision-tesla-bp-lloyds-barclays-results
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