Barclays H1 profits jump by 37 percent |
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Thu, 03 Aug 2006 11:15
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LONDON - Britain's third largest bank, Barclays Plc has reported a 37 percent hike in profits in the first six months of the year largely due to the good performance of investment banking business even though its credit card division has shown a 50 percent increase in bad debts.
Pre tax profits till June 30 were reported to be at £3.67 billion with Barclays Capital accounting for £1.246 billion, a 66 percent rise from last year's figures. Earning per share has shown a 25 percent increase at £2.31 billion while the total income has risen by 38 percent at £10.97 billion. Barclays chief executive, John Varley said that the group is well poised for future growth, "Barclays had an excellent first half, with earnings per share up 25%. We are very well positioned across the Group for future growth."
The credit card division, Barclaycard's poor performance has been due to a rising number of personal bankruptcies, which has been made easier after the Enterprise Act in 2004 that has made declaring a personal bankruptcy simpler. Mr Varley added that there could be a further increase in the bad debts and the retail credit conditions "to remain challenging".
Meanwhile Absa, acquired by Barclays for $4.5 billion last year, has reported a 50 percent increase in the overseas banking up from 40 percent last year. Commenting on Absa's performance Varley said, "Absa is flying. The unit has outperformed the acquisition business plan in every area", he added.
All of Barclays' competitors, HSBC, Lloyds TSB and HBOS have reported a rise in profits for the first half of the year. Barclays' shares were valued at 635 pence up 7.5 pence putting the company to be valued at 41 billion pounds. Barclays is ranked seventh on the nine-member FTSE 350 Banks Index with an increase in its stock at 2.7 percent over the year.
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