Bank of America analysts gushed over Barclays’ first-quarter performance, reiterating their ‘buy’ rating on the stock.
Analysts said that while geopolitical-related concerns ahead of results were understandable, the lender “printed a strong set of numbers”.
The FTSE 100 bank booked a £2.7bn pre-tax profit, ahead of the £2.5bn pencilled in.
This was boosted by income in its investment arm surging 16 per cent to £3.9bn.
Higher transactional activity in global markets drove the takings after numerous share sell-offs ahead of President Donald Trump’s sweeping tariffs on trading partners.
Analysts said: “It was pleasing to see the investment bank (particularly the markets business) captured the opportunities in the quarter”.
They added: “There were no signs of stress in underlying credit quality within the US Consumer business.”
Barclays stock recovered to pre-tariff trading
Barclays upped its reserves for bad loans to £74m on account of “elevated US macroeconomic uncertainty”.
The firm’s investment arm makes it uniquely exposed to geopolitical tensions. Barclays shares took a bruising in the fallout of Trump’s ‘Liberation Day.’
As China struck back at the US triggering fears of a global trade war, Barclays plunged nearly ten per cent.
Following Trump’s retreat on tariffs, the lender has scraped back gains to trade broadly even with its price the month prior.
Bank of America analysts increased its 2025 estimated income for the firm by around one per cent to £28.8bn, citing its “strong first quarter performance”.
But, due it being “largely investment bank driven” analysts have not carried upgrades over to future year forecasts.
They forecast underlying profit before tax to come in at £9.1bn for the year.
They added the looming motor finance judgment could be a downside risk for the bank, if commission redresses are higher than expected.
Barclays has set aside £90m for the car mis-selling scandal. The Supreme Court is expected to provide a ruling on the use of discretionary commission agreements in the early summer.
If an adverse judgement is handed to lenders, the Financial Conduct Authority has said it will implement a redress scheme within six weeks.
