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Barclays share price: Conduct charges weigh on bank’s profits

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Conduct and litigation charges weighed on Barclays’ (LON:BARC) profits in the first nine months of the year, the blue-chip lender has disclosed. The bank, however, reaffirmed its plans to pay a dividend of 6.5p per share for the current year.

Barclays’ shares have been little changed in early trade in London this morning, and as at 08:35 BST stood at 165.76p, flat in percentage terms. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index having climbed into positive territory and currently standing 0.49 percent higher at 6,989.32 points.

Barclays posts Q3 results

Barclays announced in its third-quarter statement this morning that its profit before tax was £3.12 billion in the year-to-date, down from £3.45 billion a year ago. This year’s profits were weighed down by litigation and conduct charges of £2.1 billion, mostly related to the bank’s  £1.4-billion settlement with the US Department of Justice over mis-sold mortgage-backed securities, and a £400-million charge over payment protection insurance. Excluding litigation and conduct charges, Barclays’ profit before tax rose 23 percent to £5.27 billion.

“I am pleased to report another quarter which demonstrates that we are firmly on track to produce improved returns for shareholders as our strategy continues to deliver,” the FTSE 100 lender’s chief executive Jes Staley commented in the statement, noting that it remained Barclays’ “intention to pay a dividend for 2018 of 6.5p”.

Analysts weigh in on results

“At first blush, it seems like there is still some firepower left. The equity trading business of the firm is still sailing the ship and the number is up 35 percent which was well ahead of average estimates,” Think Markets UK analyst Naeem Aslam commented, as quoted by City A.M., adding that the bank’s fixed income business had also “printed encouraging numbers”.

As of 09:04 BST, Wednesday, 24 October, Barclays share price is 166.50p.

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