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BCS Posts Higher Q1 Earnings on Revenue Growth, Reveals Buyback Plan
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Key Takeaways
Barclays Q1 net income rose 4% as revenues climbed 6% y/y.
BCS faced 2% higher expenses and 28% y/y jump in credit impairment charges, partly offsetting gains.
Barclays announced a new buyback plan and expects 2026 CET1 of 13-14%.
Barclays (BCS - Free Report) reported first-quarter 2026 net income attributable to ordinary equity holders of £1.93 billion ($2.60 billion), up 4% from the prior-year quarter.
An increase in revenues and a strong balance sheet supported the results. However, the company recorded higher operating expenses in the quarter, which, along with an increase in credit impairment charges, hurt the results to some extent.
Barclays’ Revenues Improve, Expenses Rise
Total income was £8.16 billion ($10.99 billion), up 6% year over year.
Operating expenses (excluding litigation and conduct costs, and U.K. regulatory levies) of £4.36 billion ($5.87 billion) increased 2% year over year.
The cost-to-income ratio was 56%, down from 57% in the year-ago period.
Barclays recorded credit impairment charges of £823 million ($1.11 billion), up 28% year over year.
Pre-tax income was £2.81 billion ($3.79 billion), up 3% from the prior-year quarter.
BCS’ Balance Sheet Solid
Total assets, as of March 31, 2026, were £1,694.8 billion ($2,239.8 billion), up 8% from the Dec. 31, 2025, level.
Total risk-weighted assets increased 2% from the Dec. 31, 2025, level to £364.5 billion ($481.7 billion) as of March 31, 2026.
As of March 31, 2026, the Common Equity Tier 1 (CET1) ratio was 14.1% compared with 13.9% as of March 31, 2025.
Update on Barclays’ Share Buyback Plan
Concurrent to the earnings release, the company announced its intention to initiate a share buyback of up to £500 million, following the completion of the ongoing £1-billion share buyback announced during the fourth-quarter 2025 results.
Barclays’ 2026 Guidance
The company projects total income of £31 billion.
NII (excluding Barclays Investment Bank and Head Office) is expected to be more than £13.5 billion. Of this, Barclays U.K. is projected to generate NII in the range of £8.1-£8.3 billion.
The cost-to-income ratio is anticipated to be in the high-50s in percentage terms.
The loan loss rate is projected to be at the top of the 50-60 basis points through the cycle.
The CET1 ratio is expected to be 13-14%, and return on tangible equity (RoTE) is estimated to be more than 12%.
Barclays Investment Bank RWAs are expected to be in the mid-50s percentage of Group RWAs. The impacts of regulatory change on RWAs will be in line with the company’s prior guidance of £19-£26 billion.
In terms of capital returns, Barclays plans to return at least £10 billion between 2024 and 2026 through dividends and share buybacks, with a continued preference for buybacks. The company also expects a progressive increase in total capital returns compared with 2025.
This multi-year plan is subject to supervisory and board approvals, and an anticipated financial performance.
Barclays’ 2028 Guidance
The company expects total income to witness a compound annual growth rate (CAGR) of more than 5% between 2025 and 2028.
The cost-to-income ratio is anticipated to be in the low 50s in percentage terms. This includes gross efficiency savings of £2 billion during 2026-2028.
Management expects the loan loss rate to be 50-60 basis points through the cycle.
The CET1 ratio is expected to be 13-14%, and RoTE is estimated to be more than 14%.
Barclays Investment Bank RWAs are expected to be 50% of the Group RWAs.
In terms of capital returns, Barclays plans to return more than £15 billion of capital to its shareholders between 2026 and 2028 through dividends and share buybacks, providing capacity for additional investment and growth beyond the current plan.
Our View on Barclays
Given Barclays’ restructuring and business-simplification efforts, its operating efficiency is expected to improve in the quarters ahead. The company’s cost-saving efforts will likely keep aiding financials. However, uncertainties around the capital markets performance remains a concern.
Performance & Earnings Release Date of Barclays’ Peers
ICICI Bank Ltd.’s (IBN - Free Report) profit after tax for fourth-quarter fiscal 2026 (ended March 31) was INR137.02 billion ($1.50 billion), up 8.5% from the prior-year quarter.
IBN’s results were aided by growth in net interest income and non-interest income. A decline in provisions was a tailwind. However, higher operating expenses, along with a treasury loss, hurt the results to some extent.
UBS Group AG (UBS - Free Report) is scheduled to report quarterly results tomorrow.
The Zacks Consensus Estimate for UBS’ quarterly earnings has been unchanged at 85 cents per share over the past seven days. The figure implies a 66.7% surge from the prior-year quarter’s reported number.
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BCS Posts Higher Q1 Earnings on Revenue Growth, Reveals Buyback Plan
Key Takeaways
Barclays (BCS - Free Report) reported first-quarter 2026 net income attributable to ordinary equity holders of £1.93 billion ($2.60 billion), up 4% from the prior-year quarter.
An increase in revenues and a strong balance sheet supported the results. However, the company recorded higher operating expenses in the quarter, which, along with an increase in credit impairment charges, hurt the results to some extent.
Barclays’ Revenues Improve, Expenses Rise
Total income was £8.16 billion ($10.99 billion), up 6% year over year.
Operating expenses (excluding litigation and conduct costs, and U.K. regulatory levies) of £4.36 billion ($5.87 billion) increased 2% year over year.
The cost-to-income ratio was 56%, down from 57% in the year-ago period.
Barclays recorded credit impairment charges of £823 million ($1.11 billion), up 28% year over year.
Pre-tax income was £2.81 billion ($3.79 billion), up 3% from the prior-year quarter.
BCS’ Balance Sheet Solid
Total assets, as of March 31, 2026, were £1,694.8 billion ($2,239.8 billion), up 8% from the Dec. 31, 2025, level.
Total risk-weighted assets increased 2% from the Dec. 31, 2025, level to £364.5 billion ($481.7 billion) as of March 31, 2026.
As of March 31, 2026, the Common Equity Tier 1 (CET1) ratio was 14.1% compared with 13.9% as of March 31, 2025.
Update on Barclays’ Share Buyback Plan
Concurrent to the earnings release, the company announced its intention to initiate a share buyback of up to £500 million, following the completion of the ongoing £1-billion share buyback announced during the fourth-quarter 2025 results.
Barclays’ 2026 Guidance
The company projects total income of £31 billion.
NII (excluding Barclays Investment Bank and Head Office) is expected to be more than £13.5 billion. Of this, Barclays U.K. is projected to generate NII in the range of £8.1-£8.3 billion.
The cost-to-income ratio is anticipated to be in the high-50s in percentage terms.
The loan loss rate is projected to be at the top of the 50-60 basis points through the cycle.
The CET1 ratio is expected to be 13-14%, and return on tangible equity (RoTE) is estimated to be more than 12%.
Barclays Investment Bank RWAs are expected to be in the mid-50s percentage of Group RWAs. The impacts of regulatory change on RWAs will be in line with the company’s prior guidance of £19-£26 billion.
In terms of capital returns, Barclays plans to return at least £10 billion between 2024 and 2026 through dividends and share buybacks, with a continued preference for buybacks. The company also expects a progressive increase in total capital returns compared with 2025.
This multi-year plan is subject to supervisory and board approvals, and an anticipated financial performance.
Barclays’ 2028 Guidance
The company expects total income to witness a compound annual growth rate (CAGR) of more than 5% between 2025 and 2028.
The cost-to-income ratio is anticipated to be in the low 50s in percentage terms. This includes gross efficiency savings of £2 billion during 2026-2028.
Management expects the loan loss rate to be 50-60 basis points through the cycle.
The CET1 ratio is expected to be 13-14%, and RoTE is estimated to be more than 14%.
Barclays Investment Bank RWAs are expected to be 50% of the Group RWAs.
In terms of capital returns, Barclays plans to return more than £15 billion of capital to its shareholders between 2026 and 2028 through dividends and share buybacks, providing capacity for additional investment and growth beyond the current plan.
Our View on Barclays
Given Barclays’ restructuring and business-simplification efforts, its operating efficiency is expected to improve in the quarters ahead. The company’s cost-saving efforts will likely keep aiding financials. However, uncertainties around the capital markets performance remains a concern.
Barclays PLC Price, Consensus and EPS Surprise
Barclays PLC price-consensus-eps-surprise-chart | Barclays PLC Quote
Currently, Barclays carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance & Earnings Release Date of Barclays’ Peers
ICICI Bank Ltd.’s (IBN - Free Report) profit after tax for fourth-quarter fiscal 2026 (ended March 31) was INR137.02 billion ($1.50 billion), up 8.5% from the prior-year quarter.
IBN’s results were aided by growth in net interest income and non-interest income. A decline in provisions was a tailwind. However, higher operating expenses, along with a treasury loss, hurt the results to some extent.
UBS Group AG (UBS - Free Report) is scheduled to report quarterly results tomorrow.
The Zacks Consensus Estimate for UBS’ quarterly earnings has been unchanged at 85 cents per share over the past seven days. The figure implies a 66.7% surge from the prior-year quarter’s reported number.