Upgraded Outlook and Improved Return Expectations

Barclays released its third-quarter 2025 results with a more optimistic forecast for the full year. The bank now expects Return on Tangible Equity (RoTE) to exceed 11%, compared to a previous projection of around 11%. Additionally, net interest income — excluding the investment banking division and head office — is expected to surpass £12.6 billion, up from a prior forecast of more than £12.5 billion.

Chief Executive Officer C.S. Venkatakrishnan stated that Barclays has consistently generated capital and maintained profitability for nine consecutive quarters, allowing it to accelerate part of its distribution plans. He added that starting from the upcoming quarters, the bank will move to a regular quarterly share buyback schedule — a move aimed at strengthening investor confidence and signaling stability in its capital management strategy.

Stable Profitability Despite Exceptional Charges

Although some figures in the report reflected a mild decline in performance, Barclays continues to demonstrate robust financial resilience. Pre-tax profit for the quarter reached £2.1 billion — a 7% drop from the same period last year — but remained supported by growth in investment banking activity. Total income amounted to £7.2 billion, partly offset by a £235 million charge linked to the U.K. car loan scandal. The total cost of that issue has now reached £325 million, alongside an additional one-off impairment of £110 million related to a single client.

Return on Tangible Equity for the quarter fell to 10.6%, compared to 12.3% a year earlier, while earnings per share stood at 10.4 pence. Conversely, the investment banking division recorded an 8% year-on-year rise in income — reflecting the continued strength of Barclays’ international operations.

Rising Share Price and Strong Banking Sector Performance

Despite short-term challenges, Barclays’ share price climbed 3.4% at the start of London trading, bringing its year-to-date gain to over 35%. The broader European banking sector also remains strong, with the Stoxx 600 Banks Index advancing by around 55% since the start of 2025.

At the same time, U.S. banking giants JPMorgan Chase and Goldman Sachs also reported better-than-expected quarterly earnings, reinforcing positive sentiment across the global financial system.

Challenges and Forward Outlook

Analysts at RBC noted that excluding litigation-related costs, Barclays would have posted a pre-tax profit about 6% above expectations. However, they cautioned that the regulatory landscape in the U.K., coupled with fiscal uncertainty ahead of the Autumn Budget, continues to pose challenges for the financial sector.