Barclays Q3 Pre-Tax Profit Beats Estimates Despite Provision Rise

By Scott Kanowsky

Investing.com -- Barclays PLC (LON:BARC) reported better-than-expected profit in the third quarter, as the lender was boosted by strong performance in fixed income trading that helped offset an uptick in provisions.

The British bank's pre-tax income for the three months ended on September 30 jumped by 6% compared to the corresponding period last year to £1.97 billion, above analyst estimates.

Solid client activity at Barclays' markets division and a recent increase in interest rates combined to outweigh a slowdown in its investment banking business, where fees were reduced. Results at its consumer, cards and payments division also surged.

Meanwhile, credit impairment charges related to possible bad debts moved up to £381 million, with Barclays warning of a "deteriorating" macroeconomic outlook.

Total group operating expenses also expanded by 14% annually to £3.9 billion due to the appreciation of the U.S. dollar against the pound, soaring inflation, and investments in the company.

But the bank continued to back its full-year guidance, saying it is targeting RoTE of greater than 10%, a common equity tier one ratio - or capital buffer - of 13%-14%, and costs of around £16.7 billion.