Barclays Capital stability calms investors

Barclays led big bank shares up yesterday as it issued a reassuring trading statement with no more bad news from its investment bank.

The bank's shares rose 5.4 per cent after it updated the market on its retail and commercial banking operations. Barclays rushed out details of credit crunch writedowns at its investment bank nearly two weeks ago to ease market jitters. The lack of more bad news in yesterday's statement calmed investors.

The news lifted shares of Royal Bank of Scotland 2.2 per cent. Investors have been concerned about RBS's exposure to US mortgages and leveraged loans. HBOS shares also rose, climbing 2.9 per cent.

Barclays is acting as a bellwether for UK lenders exposed to the capital markets because its Barclays Capital investment bank was involved in the booming credit markets and has given the most information about its exposure. BarCap wrote down £1.3bn in the four months to the end of October. A fund manager said Barclays' statement "gives a degree of comfort" but said the UK's banks needed debt markets to reopen to avert a big hit to earnings and the economies that feed their growth.

Chris Lucas, the bank's finance director, told analysts 2008 would bring "a greater range of uncertainty". Barclays reported little impact from the credit crunch on its retail banking operations in the first nine months of the year. Bad-debt performance in unsecured lending and at Barclaycard improved and charges "remained negligible" in mortgages, it said.

Despite the credit crunch, the bank said its liquidity remained strong and it gained from inflows of deposits. Earnings per share for 2007 will be "broadly in line with the current market consensus" of 68.8p, giving the bank some leeway in current unpredictable market conditions.

The UK retail bank had good profit growth, excluding settling of reclaimed overdraft fees from previous years, the bank said. Underlying profit growth at Barclaycard was strong. International retail and commercial banking had strong growth, though profit in sterling at ABSA, the South African bank owned by Barclays, fell because of the weak rand.

Alliance & Leicester was the worst performer of the UK banks after the ratings agency Standard & Poor's changed its outlook on the company to negative from stable. S&P said tight inter-bank lending conditions were putting pressure on its funding and earnings. S&P predicted tighter margins, reduced business growth and write-downs on structured finance assets. It kept its ratings on A&L's debt because the bank is "fundamentally sound" in terms of asset quality, profitability and capital.

Sport
The sun rises over St Andrews golf course, but will it be a new dawn for the Royal and Ancient Golf Club?
sportAnd it's Yes to women (at the R&A)
Arts and Entertainment
Friends is celebrating its 20th anniversary this year
tvSeries celebrates 20th anniversary
Sport
Yaya Touré (left) and Bayern Munich’s Spanish defender Juan Bernat
footballToure's lack of defensive work is big problem for City
Voices
voicesApple continually kill off smaller app developers, and that's no good for anyone
PROMOTED VIDEO
Arts and Entertainment
Liam Neeson said he wouldn't
tv

Liam Neeson's Downton dreams

Sport
Wembley Stadium
footballNews follows deal with Germany
Arts and Entertainment
A spell in the sun: Emma Stone and Colin Firth star in ‘Magic in the Moonlight’
filmReview: Magic In The Moonlight
News
ebooksAn unforgettable anthology of contemporary reportage
Sport
A 'Sir Alex Feguson' tattoo
football

Arts and Entertainment
Ben Whishaw is replacing Colin Firth as the voice of Paddington Bear
tv

Thriller is set in the secret world of British espionage

Life and Style
life

News
ScienceGallery: Otherwise known as 'the best damn photos of space you'll see till 2015'
Life and Style
fashion

Bomber jacket worn by Mary Berry sells out within an hour

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SQL Developer - Watford/NW London - £320 - £330 p/d - 6 months

£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...

Head of Audit

To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...

Audit Manager Central Functions

To £85,000 + banking benefits: Saxton Leigh: You will be expected to carry out...

Credit Risk Audit Manager

Up to £90,000 + benefits: Saxton Leigh: Credit Risk Audit Manager required to ...

Day In a Page

Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam
'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

'She was a singer, a superstar, an addict, but to me, her mother, she is simply Amy'

Exclusive extract from Janis Winehouse's poignant new memoir
Is this the role to win Cumberbatch an Oscar?

Is this the role to win Cumberbatch an Oscar?

The Imitation Game, film review
England and Roy Hodgson take a joint step towards redemption in Basel

England and Hodgson take a joint step towards redemption

Welbeck double puts England on the road to Euro 2016
Relatives fight over Vivian Maier’s rare photos

Relatives fight over Vivian Maier’s rare photos

Pictures removed from public view as courts decide ownership
‘Fashion has to be fun. It’s a big business, not a cure for cancer’

‘Fashion has to be fun. It’s a big business, not a cure for cancer’

Donatella Versace at New York Fashion Week