Barclays quarterly profit misses expectations on weak FICC showing

Barclays PLC on Thursday reported lower-than-expected third quarter income and profit weighed by weak trading in its fixed income, currencies & commodities business.

In response, shares in the London-based lender were down 1.2% at 414.30 pence each in London early Thursday morning.

Barclays reported pretax profit of £2.32 billion in the three months ended September 30, up 12% when compared to £2.08 billion the year prior, but below £2.42 billion company compiled consensus.

Profit before impairment charges grew 4% to £2.83 billion from £2.71 billion, missing £3.07 billion consensus.

Total income rose 3% to £7.37 billion from £7.17 billion on-year, and operating expenses edged down to £4.56 billion from £4.50 billion.

Income was below £7.62 billion consensus, although expenses were better than the £4.62 billion pencilled in.

By division, income rose 10% at Barclays UK Corporate Bank and at Barclays Private Bank & Wealth Management. Income fell 1% at Barclays US Consumer Bank and edged up by the same amount at Barclays Investment Bank. Head Office income dropped 48%.

Barclays said the investment bank delivered a strong equities performance, up 47% on-year,

offsetting a challenging environment for fixed income, currencies & commodities, which fell 19% on-year, compared to consensus which forecast a 2% rise.

Overall, profit in the Investment Banking business came in at £1.01 billion, 10% below £1.12 billion consensus.

Barclays said it was structurally reducing the cost base through technology-enabled staff cuts which will create capacity for further investment in the business.

Third quarter structural cost actions of £201 million were disclosed, with a further £300 million planned in the fourth quarter.

For 2026, costs are expected to be around £18.5 billion, before easing to £18.4 billion in 2027.

Earnings per share rose to 12.3 pence from 10.4 a year ago, just ahead of 12.2p consensus.

Return on average tangible equity improved to 11.7% from 10.6%. The cost income ratio fell to 62% from 63%.

At September 30, the common equity tier 1 ratio was 14.2% compared to 14.1% a year ago.

Barclays said the strong organic capital generation means it could announce a new £500 million share buyback tranche.

Chief Executive CS Venkatakrishnan said: "With one quarter to go before the end of our original three-year plan, we have either achieved or are on track to achieve all of our 2026 group targets. We are confident in and committed to the 2028 targets that we laid out earlier in the year."

For 2026, the firm is targeting a total income of around £31.5 billion, with net interest income, excluding the investment bank and head office, above £13.7 billion. It sees Barclays UK net interest income around the middle of a £8.1 billion to £8.3 billion guided range. Guidance is unchanged from the outlook it gave in its half-year results.

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