Barclays (NYSE:BCS) shares retreated on Tuesday as investors assessed the prospect of cost-cutting charges, pressure on domestic interest margins and weak performance in formerly strong divisions.
The bank reported a net profit of £1.27 billion ($1.56 billion U.S.) for the third quarter, slightly ahead of expectations as strong results in its consumer and credit card businesses compensated for weakening investment bank revenues.
Analysts polled by Reuters had produced a consensus forecast of £1.18 billion, down from £1.33 billion in the second quarter and £1.51 billion for the same period in 2022.
Barclays CEO C.S. Venkatakrishnan said the bank “continued to manage credit well, remained disciplined on costs and maintained a strong capital position” against a “mixed market backdrop.”
Barclays will set out its capital allocation priorities and revised financial targets in an investor update alongside its full-year earnings, he added.
Barclays’ corporate and investment bank saw income decrease by 6% to £3.1 billion, with the bank citing reduced client activity in global markets and investment banking fees.
Revenue in the traditionally robust fixed income, currency and commodities trading division dropped 13% as market volatility moderated, dampening trading volumes.
This was mostly offset by a 9% revenue increase in its consumer, cards and payments business to £1.4 billion, reflecting higher balances on U.S. cards and a transfer of the wealth management and investments division from Barclays U.K.
BCS shares dipped 56 cents, or 8%, to $6.46.