Barclays Capital and Barclays’ UK retail banking operations have seen a first-quarter improvement, while Barclaycard continues to be affected by rising levels of bad debt.
Barclays performed very strongly in the first quarter, said John Varley, chief executive. High levels of activity with our customers and clients enabled us to deliver excellent profit growth, the Financial Times quoted him as saying.
The report stated that the UK’s third largest bank claimed to have seen excellent profit growth in the first quarter of the year, predicting the full year income for 2006 would exceed all market expectations.
According to the Financial Times, retail banking income is now growing at a faster rate than in 2005 and Barclays is increasing the rate of investment in restructuring and operational infrastructure for 2006, in a bid to boost operating efficiency along with customer service,
However the newspaper also reported that Barclaycard credit cards business is continuing to experience similar problems to 2005 – especially rising bad debt charges.
The report explained that despite seeing very strong first-quarter income growth Barclaycard’s higher impairment charges in UK credit cards and consumer loans offset this, along with investment in the business. The bank has since taken steps to tighten its lending criteria.