Barclays full-year earnings consensus revised down

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The Independent Online

Barclays Bank has revised down its calculation of analysts' consensus for its full-year profit for the second time this month – cutting the figure for 2008 by nearly 8 per cent after a drop of 15 per cent two weeks ago.

The consensus for Barclays' 2008 pre-tax profit now stands at £5.876bn – a forecast 17 per cent lower than the 2007 figure. When the bank issued a trading statement on 15 May, its finance director, Chris Lucas, told analysts he was comfortable with the previous forecast of £6.356bn.

Barclays declined to comment yesterday. The reduced consensus figure reflects analysts' changed estimates for the bank's performance this year and is not profit guidance from Barclays.

If Barclays believed the full-year figures were going to be materially different from consensus, it would have to issue a statement to the Stock Exchange. Barclays is unusual in publishing the consensus figure on its website. The figure normally changes between 10 and 12 times a year and alterations went largely unnoticed before markets became jittery about banks' earnings.

Both the revised figure and the earlier consensus are weighed down by an outlying low estimate of £390m from analysts at ABN Amro, which Barclays failed to buy last year and is now owned by Royal Bank of Scotland. Stripping out the ABN figure, consensus would now be £6.137bn, a projected fall of 13 per cent year on year. The highest estimate predicts that profits will rise 6.3 per cent this year.

A banking analyst said: "Consensus is all over the place. All it shows is the uncertainty on the earnings picture for banks and their future plans."

Uncertainty is hanging over Barclays at the moment because Britain's third-biggest bank has made modest writedowns at its Barclays Capital investment bank compared with the big hit taken by RBS when it announced its rights issue. Marcus Agius, Barclays' chairman, told shareholders at the bank's annual meeting last month that some lenders' assets were better quality than others.

Citi analysts predict a 27 per cent fall in Barclays' pre-tax profit to £5.189bn this year based on expectations of slower growth at the Barclays Capital investment bank and £2.8bn of write-downs by that business. Analysts expect Barclays to announce a capital raising to boost its buffer against losses.

Barclays' shares closed down 0.9 per cent at 387.25p.