Barclays UK profits up, income from mortgage lending rises

Barclays UK

Barclays’ current UK mortgage balance is $199.66bn, up from $198.41bn in the previous quarter and flat on the same period last year

Barclays’ UK business has reported pre-tax profits of £594m ($745.43m) for the first quarter of 2022, up from £460m ($577.27m) during the same period last year.

Income from its personal banking division, which includes mortgage lending, rose 11 per cent to £1.02bn ($1.28bn) which it said was driven by rising interest rates and strong mortgage origination in 2021.

Loans and advancements to customers fell by one per cent to £207.3bn ($260.15bn). Despite a £1bn ($1.25bn) growth in mortgage lending, this was offset by a £2.3bn ($2.89bn) decline in business banking balances following the repayments of government loans. Net mortgage balances rose £1bn ($1.25bn) quarter-on-quarter and £7.2bn ($9.04bn) annually.

Barclays’ current UK mortgage balance is £159.1bn ($199.66bn), up from £158.1bn ($198.41bn) in the previous quarter and flat on the same period last year.

The UK division’s net interest income rose five per cent to £1.3bn ($1.63bn) during the period with a net interest margin of 2.62 per cent. It said this was primarily driven by the UK’s rising rate environment.

The Barclays group reported a seven per cent decline in profits, down to £2.2bn ($2.76bn).

Its costs amounted to £4.1bn ($5.15bn) including litigation, conduct charges of £500m ($627.47m) relating to the over-issuance of securities by its US business, and customer remediation costs. Last year, the bank was fined £783,800 ($983,618.05) by the Financial Conduct Authority for failing to properly oversee its business with Premier FX.

S. Venkatakrishnan, group chief executive of Barclays, said: Our performance includes the relevant costs relating to the over-issuance of securities in the US and customer remediation of a legacy loan portfolio.

He said: Our income growth was driven partly by global markets, which has been helping clients navigate ongoing market volatility caused by geopolitical and economic challenges including the devastating war in Ukraine, and by the impact of higher interest rates in the US and UK.

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