Barclays UK accomplished £5.6bn in gross mortgage lending in Q3, down from £7.8bn final yr.
Its outcomes for the interval confirmed gross mortgage lending was secure in comparison with the earlier quarter the place it lent £5.5bn.
Barclays stated the drop in loans issued was pushed by “subdued mortgage lending” and decrease business banking balances because of the reimbursement of presidency scheme lending.
Its loans and advances to prospects fell from £205.1bn as of December 2022 to £204.9bn as of 30 September 2023.
Barclays UK reported a internet curiosity margin of 3.04 per cent up from 3.01 per cent in 2022. Compared to Q2, this was 18 foundation factors down on 3.22 per cent.
Compared to final yr, there was a smaller impairment cost in Q3 of £59m down from £81m in 2022. The lender attributed this to “strong credit performance” and a moderated unemployment outlook. However, it famous that larger rates of interest have been leading to missed funds on tracker mortgages.
Year-on-year, Barclays UK’s revenue earlier than tax in Q3 was comparatively flat at £765m, in comparison with £762m in Q2 2022.
Year thus far efficiency
The financial institution accomplished £18.1bn in gross UK mortgage lending within the 9 months to September, down on £21.7bn final yr.
The internet curiosity margin for the yr thus far was 3.15 per cent up from 2.78 per cent final yr and the group stated for the entire of 2023, it anticipated this to take a seat between 3.05 per cent and three.1 per cent for the UK business. Barclays stated this was depending on deposit balances and rate of interest expectations.
For the yr thus far, Barclays UK’s internet curiosity revenue totalled £4.8bn, which was barely larger than the £4.2bn generated final yr. For the Q3 interval, this was flat at £1.5bn.
Credit impairments on rise
Barclays UK greater than doubled its credit score impairment costs for the yr thus far from £129m final yr to £267m this yr. It put this right down to “updated macroeconomic scenarios” citing enhancing GDP and unemployment towards a backdrop of upper rates of interest and a weaker home worth market.
The wider group reported a revenue earlier than tax of £1.9bn for Q3, barely down on £2bn final yr. For the yr thus far, this got here to £6.4bn which was up on the earlier yr’s £5.7bn.
C.S. Venkatakrishnan, group chief government of Barclays, stated: “We delivered an 11 per cent return on tangible fairness in Q3, towards a blended market backdrop, as we continued to handle credit score nicely, remained disciplined on prices and maintained a robust capital position, with a Common Equity Tier 1 (CET1) ratio of 14 per cent.
“We see further opportunities to enhance returns for shareholders through cost efficiencies and disciplined capital allocation across the group.”
Shekina is the industrial editor at Mortgage Solutions. She has over 4 years’ expertise within the B2B publishing market, with earlier industries together with the accounting, pet, funeral, hospitality, retail and jewelry trades.
She at the moment studies on present occasions within the mortgage market and liaises with monetary shoppers to supply sponsored content material.
Follow her on Twitter at @ShekinaMS
