“We remain positive on UK banks with the runway clearing and look for an activity-driven rebound to deliver above-consensus earnings for a number of our banks alongside positive rates optionality at undemanding valuations.”
Barclays says it expects to see improving domestic income (mortgage tailwind, steeper yield curves), strong investment bank revenues, benign asset quality (case for write-backs building), and robust capital ratios with the focus shifting to likely second half dividend restarts.
US peers Goldman Sachs and JP Morgan yesterday smashed through estimates in their respective first quarters.
Goldman posted a 102% increase in net revenues to US$17.7bn for the quarter to March 31, while pre-tax earnings rocketed 518% to US$8.3bn.
JP Morgan’s net income zoomed up 399% to US$14.3bn, mostly thanks to credit reserve releases of US$5.2bn.
Lloyds shares eased 1% to 43.37p.