Banks
Barclays profit trails forecasts as fixed income trading drops 19%; bank adds £500 million buyback
Third-quarter pre-tax profit rose 12% to £2.3 billion, short of the roughly £2.4 billion analysts expected, as a weak bond-trading quarter offset a 47% jump in equities.
HedgeWeekly News Desk ·
Barclays made £2.3 billion of pre-tax profit in the three months to September, up 12% from £2.1 billion a year earlier but below the average analyst forecast of about £2.4 billion compiled by Reuters. The UK lender also announced a fresh £500 million share buyback alongside the figures on Thursday.
The gap came from the investment bank, which brought in £3.1 billion of total income against a £3.3 billion forecast. Equities revenue climbed 47% to around £1 billion, ahead of the 37% average rise at the five largest US investment banks, by Reuters' count. Fixed income trading moved the other way, falling 19% to just over £1 billion, against an average drop of about 5% at US rivals.
That reverses the balance of a year ago. In the third quarter of 2025, Barclays booked £1,256 million from fixed income, currencies and commodities and £689 million from equities; this time the two lines finished roughly level. The results open reporting season for Europe's big lenders and land less than a week before Chancellor John Healey presents his first Budget on October 28, where tougher taxes on banks are under discussion. The bank surcharge currently stands at 3%, down from 8% before a 2023 cut.
For holders, the £500 million buyback keeps the quarterly rhythm Barclays adopted in October 2025, when it paired an identical programme with a plan to announce buybacks every quarter. The open question is fixed income: it was the bigger trading engine last year, and its underperformance against US peers now weighs on the investment bank. Next to watch are any change to the surcharge in the Budget and whether Barclays holds to the target, reaffirmed a year ago, of a return on tangible equity above 12% for 2026.